Female Entrepreneurship in Transition Economies: An Overview

Entrepreneurship is an emerging research area among academics because it is generally acknowledged that fostering entrepreneurial activity is associated with greater economic growth (Weeks and Seiler, 2001). From a gender perspective, the rising phenomenon of women becoming entrepreneurs not only encourages economic development but also empowers women (Gill and Ganesh, 2007). Stimulating local economic growth through female entrepreneurship is now a major item on the economic agendas of most countries in transition (Radović-Marković, 2008). In many countries, however, the role of female entrepreneurs was unrecognized until ten years ago. In the first place, their potential role in reducing female unemployment had been unknown. Female entrepreneurs contribute to the diversity of entrepreneurship in the economic process (Verheul and Thurik, 2001). Furthermore, female-owned small and medium-sized enterprises (SMEs) can assist in fighting the trafficking of women, which is of great concern in many countries that are in a transitional state (Aidis et al., 2007). In addition, the impact of female entrepreneurs on a country’s competitiveness, productivity and growth potentials was not known, and therefore, women did not get enough support from society to reach their entrepreneurial and managerial potential (Radović-Marković, 2011a). This statement can be supported by the fact that only five of the Fortune 500 industrial and service companies had female CEOs in the early 1990s (Feminist Majority Foundation, 1991), and of the highest paid officers and directors of the 1,300 largest industrial and service-oriented companies, women accounted for less than 0.5% (Dodge and Gilroy, 1995). The numbers have improved, but at the end of the 1990s, one survey found that only 11% of Fortune 500 board members were women (Mann, 1999). On the other side of the coin, however, often a modest family budget does not afford the ability to generate funds or savings, which most women use to start new businesses (Radović-Marković, 2012). In addition, in most transition and developing countries, barriers to gender entrepreneurship development still exist.