The Myth of Female Credit Discrimination in African Manufacturing

Henrik Hansen & John Rand (2014). “The Myth of Female Credit Discrimination in African Manufacturing” , The Journal of Development Studies, 50:1, 81-96


We examine credit constraint differentials between male and female manufacturing entrepreneurs using firm data from 16 sub-Saharan Africa countries. Small enterprises owned by female entrepreneurs are less likely to be credit constrained compared to their male counterparts, while this is reversed for medium-sized enterprises. A generalised Oaxaca–Blinder decomposition shows that the gap is predominantly a pure gender effect. We argue that this finding is mainly due to female favouritism in loans to micro and small firms because the gap is reversed for medium-sized enterprises and because we find no sign of superior female entrepreneurial performance in observable indicators.