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Gender-differentiated Social and Human Capital and the Use of Microcredit in Bangladeshi Female Entrepreneurship

Abstract

In many developing countries, microfinance has become a critical component in implementing poverty reduction strategies, which are often addressed through social business and female entrepreneurship. Despite poor individuals being excluded from formal credit, microfinance organisations are delivering opportunities for them to obtain small amounts of credit. This chapter examines whether gender-differentiated social and human capital matters in social entrepreneurship, and how loans received by Bangladeshi men and women are being used in productive ways. It identifies barriers that might exclude the poorest women from these microfinance programs in Bangladesh. This analysis has important policy implications for donors, microfinance institutions and NGOs operating in developing countries as it focuses on employment generation and poverty alleviation, and also on impact on poor women in microcredit programs.

Keywords

  • Bangladesh
  • Female entrepreneurship
  • Gender differentiation
  • Human capital
  • Microcredit
  • Microfinance
  • Social capital

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Notes

  1. 1.

    Formula used: \( \mathrm{PAIz}=\frac{\mathrm{Index}-\min }{\max -\min } \) Here, PAIz = normalised physical capital index.

  2. 2.

    See Rakib and Matz (2015) for the physical asset index construction details. The results were largely robust from using the total value of household physical assets measured by the leave out mean at the village level.

  3. 3.

    As not all of the household heads were married, the responsible adult male and female members of each household were asked directly for information about their membership and about the extent of their participation in formal and informal groups, and in voluntary and involuntary associations.

  4. 4.

    See Rakib and Matz (2016) for the social and political capital index construction details, and Rakib and Matz (2015) for the details of the physical capital index construction.

  5. 5.

    Note that the results were mostly robust based on the variable of total plot size of households calculated in the leave out village mean.

  6. 6.

    For details of shock definition and classification, see Rakib and Matz (2016).

  7. 7.

    Another measure of human capital was obtained by measuring the access to information and training by males and females, which also reflected a positive and significant relationship with both main male and female members of the household.

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Acknowledgements

The authors thank Professor Patrick Alan Danaher, Dr. Jan Stenton and Miss Katrina Wilson for their feedback on previous versions of this chapter.

Appendix

Table 9.10 Community participation and other factors associated with the productive use of credit by main adult male and female, marginal effects presented

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Rakib, M., Chakrabarty, S., Winn, S. (2018). Gender-differentiated Social and Human Capital and the Use of Microcredit in Bangladeshi Female Entrepreneurship. In: Ní Shé, É., Burton, L., Danaher, P. (eds) Social Capital and Enterprise in the Modern State. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-68115-3_9

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