How Access to Credit Affects Self-Employment: Differences by Gender during India's Rural Banking Reform

Household survey data for 1983-2000 from India's National Sample Survey Organization are used to examine the impact of credit on self-employment among men and women in rural labor households. Results indicate that credit access encourages women's self-employment as own- account workers and employers, while it discourages men's self-employment as unpaid family workers. Ownership of land, a key form of collateral, also serves as a strong predictor of self- employment. Among the lower castes in India, self-employment is less likely for scheduled castes prone to wage activity, but more likely for scheduled tribes prone to entrepreneurial work.

Menon and Rodgers (2011)

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Instrumental variable probit models for likelihood of being self-employed with 1983-2000 NSSO.Land titling and credit.Credit access encourages women's self-employment as own-account workers and employers; land ownership also serves as a strong predictor of self-employment.http://www.tandfonline.com/doi/abs/10.1080/00220381003706486#.UcHhF-evPoI408,385 individuals (43% women).