Microfinance, gender and entrepreneurial behaviour of families in Ghana

Purpose The purpose of this paper is to understand the relationship between microfinance participation and entrepreneurial behaviour of Ghanaian families as well as the moderating role of the family head's gender. It is argued from a resource-based theory perspective that microfinance is a financial resource that removes credit constraints to entrepreneurial behaviour of families. However, gender of the family head creates heterogeneity in this relationship in line with the gender theory. Design/methodology/approach In order to test these claims, cross-sectional data from 2,727 families on microfinance participation and household characteristics in Ghana are utilised. Findings The study finds that microfinance participation has a positive and significant relationship with a family's decision to own an enterprise. Also, the study finds that female-headed families are better utilizers of microfinancial resources for entrepreneurial purposes compared to their male counterparts. This difference is a pure gender effect. Originality/value This finding is in contrast to the dominant stream of gender-based entrepreneurship research that suggests that women are subordinate to men and need to be helped to become honorary men. From a policy standpoint, solutions aimed at reversing discrimination against women in economic markets must consider women within their own right. The study makes a contribution to the literature by showing empirically the source of heterogeneity in entrepreneurial returns to microfinance participation by families.