Does Sex Imbalance Affect Family Businesses? Evidence from Rural China

This paper suggests that sex imbalance is a gender-related determinant of entrepreneurship. China has been experiencing an increasing surplus of men in the pre-marital age cohort since the late 1970s. This sex imbalance intensifies the mating competition among single men, thus stimulating households with sons to build wealth through start-up businesses. By examining households' ownership of businesses based on a 2009 Rural Finance Survey in China, we find that son households are more likely to own businesses in villages where the sex imbalance is more severe. We further provide evidence that these son households are more capable of sustaining their businesses.