Are Liquidity Constraints Holding Women Back? An Analysis of Gender in Self-Employment Earnings

Kate Rybczynski

The Journal of Economic Asymmetries, 2009, vol. 6, issue 1, 141-165

Abstract: In Canada, the 1999 mean self-employment earnings for women is $22,995 compared with $38,350 for men (Devlin, 2001). The majority of this earnings gap is unexplained. In this paper, I investigate liquidity constraints as a potential determinant of the gender gap. Consistent with Hurst and Lusardi (2004) I find that the relationship between liquidity and self-employment is non-linear. Furthermore, the non-linearity is asymmetric across gender. In particular, women's earnings are affected at lower levels of liquidity. Using a baseline specification, I estimate that over 95 percent of the earnings gap would be eliminated in the absence of liquidity constraints.

Keywords: J16; J23; Self-employment; Earnings; Gender differentials; Credit constraints (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:joecas:v:6:y:2009:i:1:p:141-165

DOI: 10.1016/j.jeca.2009.01.010

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