Monash Business School’s Dr Abu Zafar Shahriar, in collaboration Professor Dean Shepherd from the University of Notre Dame in Indiana, are examining how microfinance can create opportunities to lift people out of poverty in developing countries.
Their latest research findings show women who have experience domestic violence in the past 12 months are six percentage points less likely to begin a new business venture with microfinance, compared to those who did not.
Additionally, women are 19 percentage points more likely to believe that fear of business failure would restrain them from initiating a new venture. As the number of violent acts by a husband increases, so does their fear of business failure – increasing by 5.5 percentage points.
The study centred on the experiences of 583 women in Bangladesh who received small collateral-free loans to build their own business venture. A survey was conducted prior to the loan with a follow-up survey 12-15 months later. Out of these women, 156 (or 28%) reported experiencing some form of domestic violence by their husband.
“If entrepreneurship creates opportunities for women to escape an abusive relationship by becoming more financially independent, why aren’t more women doing it? How does domestic violence affect women’s economic activities? It’s an under-studied area,” Dr Shahriar said.
“Being an entrepreneur requires a reasonably high sense of self-esteem. Individuals who believe in their capabilities are likely to evaluate new business opportunities favourably because they believe they have the ability to overcome setbacks and failures.
