While this is good news, there’s a need to distinguish between high and low value female entrepreneurship. High value implies higher incomes and innovative goods and services and low value the opposite.
Entrepreneurs are also usually classified into necessity-driven and opportunity-driven types. Necessity-driven entrepreneurs are those who are pushed into starting businesses because they have no other source of income. Opportunity-motivated entrepreneurs are those who enter business ownership primarily to pursue an opportunity.
Research shows that typically, necessity-driven entrepreneurship is more dominant in emerging economies like Nigeria.
In the most recent Global Entrepreneruship Monitor survey of Nigeria, 74% of female early stage entrepreneurs reported that they were opportunity driven entrepreneurs. This was the same percentage recorded for men.
Our research looked at if women would be able to create better entrepreneurial value if they had the same education as men in Nigeria. By examining data from the Nigerian National Bureau of Statistics, we concluded that if women had the same education opportunities as men, they would be able to create higher value entrepreneurship.
Low-income countries such as Nigeria and Zambia have the highest entrepreneurship rates in the world.
This is because low-income countries lack the human capital and infrastructure needed to create high quality jobs. The result is that many people end up engaging in hand-to-mouth entrepreneurship on street corners and in traffic. But there are few innovative, high-growth start-ups. These street vendors don’t represent business ownership as defined in many developed countries.
For high value entrepreneurship to occur, quality matters more than quantity. Therefore a country needs to have the best entrepreneurs, not necessarily the most. What the “best and the brightest” do is important. This is the contribution that our research makes.
Nigeria, like many emerging countries, needs to educate its women at the same rate it educates its men so that women can enter the ranks of best and brightest more often.
Education as a factor
The media often celebrates the “high-school dropout” who reportedly made it big in the business world armed with an education from the “school of hard knocks”. But this indeed happens infrequently. In reality, experience in the entrepreneurial field and education are good determinants of business success.
Entrepreneurship literature recognises that endowments in human capital significantly affect the probability of being either an entrepreneur or engaging in paid employment.
Just as education prepares individuals for paid work, education also endows business owners with the needed expertise for success.
Our research confirmed that women in Nigeria generally have lower educational endowments than men and consequently, a higher proportion of them are engaged in non-innovative entrepreneurial ventures.
Crucially, if Nigerian men and women had the same endowments in education, Nigerian women who have the same educational endowments as men would be able to create more entrepreneurial opportunities in high value ventures.
Thus, the type of entrepreneurship Nigerian women engage in would naturally shift from hand-to-mouth necessity entrepreneurship to high value opportunity entrepreneurship.
Why girls don’t go to schools
Some families don’t send girls into schools at the same rates as males. The school enrolment gender parity index for Nigeria is improving but still significant and there are huge regional variations within the country. Girls in the South are more likely to attend school than girls in the North. In addition, the tertiary education gender parity index for the country is worse than for primary and secondary schooling.
While the Nigerian constitution prohibits discrimination on the grounds of gender, this is not universally enforced. Customary and religious laws sometimes restrict women’s rights. Consequently, Nigeria has large gender gaps in education, economic empowerment, income, and political participation.
The adherence to some Islamic and customary laws reinforces practices that are unfavourable to women. These relate to freedom of movement, marriage, and inheritance.
A previous attempt to end all forms of gender discrimination has failed. The bill proposing to entrench this in law was considered in the mid-2000s but was defeated in Parliament.
Value of educating more women
This is indeed laudable. But for it to be replicated, more women need to be educated so that they too can engage in high value entrepreneurship. This way, Nigeria could also celebrate more innovative and better paid jobs created by females.
Nigeria is improving in its education rates for females. But more should be done. Policymakers and educators could also consider incorporating more entrepreneurship and vocational modules into the curriculum to stimulate entrepreneurship especially in the absence of paid jobs. The same applies to many countries in the same situation.
In addition, Nigeria needs to remove discriminatory practices. According to the World Bank Running a Business Report, Nigeria is one of 115 economies surveyed where women cannot run a business in the same way as men.
Nigerian women can legally open businesses and sign contracts the same way as men. But they can be discriminated against in terms of access to credit. And as our research shows, education.
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