A THEORETICAL

OVERVIEW AND
EXTENSION OF RESEARCH
ON SEX, GENDER, AND
ENTREPRENEURSHIP
EILEEN M. FISCHER
York University

A. REBECCA REUBER
University of Toronto

LORRAINE S. DYKE
Carleton University

With the rising number of women-owned businesses has come a consid-

EXECUTIVE erable amount of research, and even more speculation, on differences
SUMMARY between male and female entrepreneurs and their businesses. To date,
these @dings and speculations have been largely atheoretical, and little
progress has been made in understanding whether such differences are
pervasive, let alone why they might exist. Thus public policy-makers have
had little guidance on such difficult issues as whether or not unique training and support programs
should be designed for women versus men. Moreover, lenders who finance new and growing firms
have little to go on but their own “gut instinct” in assessing whether women’s and men’s businesses
are likely to run in similar ways, or whether they might be run in dtserent but equally effective ways.
The lack of integrative frameworks for understanding the nature and implications of issues
related to sex, gender, and entrepreneurship has been a major obstacle. Two perspectives that help
to organize and interpret past research, and highlight avenues for future research, are liberal feminism
and social feminism.
Liberal feminist theory suggests that women are disadvantaged relative to men due to overt
discrimination andlor to systemic factors that deprive them of vital resources like business education
and experience. Previous studies that have investigated whether or not women are discriminated
against by lenders and consultants, and whether or not women actually do have less relevant education
and experience, are consistent with a liberal feminist perspective. Those empirical studies that have
been conducted provide modest evidence that overt discrimination, or any systematic lack of access
to resources that women may experience, impedes their ability to succeed in business.

Address correspondence to Eileen M. Fischer, Faculty of Administrative Studies, York University, North
York, Ontario, Canada M3J 1P3.
The authors gratefully acknowledge the financial assistance of the Social Sciences and Humanities Research
Council of Canada and the National Centre for Management Research and Development, and the research assistance
of Hans Aggatwal and Gavin Bogle.

Journal of Business Venturing 8, 151-168 0883.9026/93/$6.00

0 1993 Elsevier Science Publishing Co., Inc., 655 Avenue of the Americas, New York, NY 10010

151
152 E.M. FISCHER ET AL

Social feminist theory suggests that, due to dtfferences in early and ongoing socialization,
women and men do differ inherently. However, it also suggests that this does not mean women are
inferior to men, as women and men may develop different but equaIly effective traits. Previous
entrepreneurship studies that have compared men and women on socialized traits and values are
consistent with a social feminist perspective. These studies have documented few consistent gender
differences, and have suggested that those dtfjerences that do exist may have little impact on business
performance.
While this interpretation of pastjndings is relevant to the question of if and how female and
male entrepreneurs dt#er, there are still large gaps in our knowledge. In particular, only one study
(Kalleberg and Leicht 1991) has systematically explored whether or not potential dtfferences related
to discr~mi~tion or socialization affect business performance; the study used limited measures of
business performance, and assessed only a restricted range of ~~e~ernaie dtzerences. This article
reports on a study that ex-plored other poteiltial differences related to discrimination and to socialization
(which are hypothesized based on liberal and social feminism) and looked at their relationship to a
more comprehensive set of business performance measures.
The study indicates that for a large, randomly selected sample of entrepreneurs in the manu-
facturing, retail, and service sectors, there were few differences in the education obtained by males
and females, or in their business motivations. Women entrepreneurs were, however, found to have
less experience in managing employees, in working in similar firms, or in helping to start-up new
businesses. Women’sjrms also were found to be smaller than men’s, to have lower growth in income
over two years, and to have lower sales per employee. Regressions undertaken to examine predictors
of a range of business performance indicators suggest that women’s lesser experience in working in
similar firms and in helping to start-up businesses may help to explain the smaller size, slower income
growth, and lesser sales per employee of their firms.
For policy-rn~~ker.~, this article suggests that systemic factors that afford women less access to
e_xperience must be addressed. Support for classroom training or related advisory activities may not
be warranted; there is little evidence that women lack access to relevant classroom education. However,
programs that help increase women’s access to hands-on experience in starting jrms or in working
in the industry in which they hope to set up business does seem advisable. In-class education or
counseling would not seem to compensate for lack of real-world experience, which suggests that any
available funds should be directed more toward initiatives centered on apprenticeship programs than
toward those centered on classroom teaching.
Implications for lenders and investors are less clear cut, but suggest that whatever innate
differences may exist between men and women are irrelevant to entrepreneurship. While women’s
businesses do not perform as well as men’s on measures of size, they show fewer dtifferences on other,
arguably more critical business eflectiveness measures-growth and productivity-and no dtfferences
on returns. discrimination against women-owned businesses based on these~ndings would clearly be
both unethical and t~n~~~arranted.Thehut that women appear to obtain similar growth, productivi~,
and returns, in fact, suggests that they may be compensating for e.xperience deficits in ways that
current research does not illuminate. While more systematic inquiry is required to assist in under-
standing why men’s and women’s jrms may d@er in some predictable ways, this study would suggest
that lenders and investors wishing to ussist small businesses should focus on evaluating the amount
and quality of the business and non-business experience of entrepreneurs, and consider sex an irrelevant
variable.
For entrepreneurs, this research reinforces the notion that acquiring relevant industry and
entrepreneurial experience is of considerable importance tf they seek to establish large jrms and/or
to achieve substantial firm productivity und returns. In particular, helping in the start-up oj’firms and
spending extended periods of time in the industry of choice appear to yield subsequent rewards in the
performance of any ~nd~~~idual’.~ firm. Future research is needed to investigate whether or not other
types of business experience or non-busyness experience might bring additional benefits in terms of
positive impact on future busines‘~ pe~ormance, but the indication of the current work is that one’s
sex per se is neither a liability nor an asset.
 SEX, GENDER, AND ENTREPRENEURSHIP 153

INTRODUCTION
Research on sex and gender differences in entrepreneurial characteristics and performance
has received and continues to receive a considerable amount of attention (see recent con-
tributions by Belcourt et al. 1991; Buttner and Rosen 1988, 1989; Chrisman et al. 1990;
Fagenson 1990; Kalleberg and Leicht 1991; Riding and Swift 1990; Sexton and Bowman-
Upton 1990). The empirical findings and recommendations that have been reported are
diverse and often contradictory; while many studies suggest that there are few differences
between the experiences and needs of female and male entrepreneurs (e.g., Buttner and
Rosen 1989; Chrisman et al. 1990; Riding and Swift 1990), other investigations seem to
confirm the existence of relevant male/female differences in traits (e.g., Sexton and Bowman-
Upton 1990). in experiences, and in needs (e.g., Belcourt et al. 1991).
In the broader entrepreneurship literature, highly disparate empirical findings have led
to calls for theory-driven research (Low and MacMillan 1988). Articulating and testing
theories, rather than merely accumulating empirical findings, allows for a more systematic
development of knowledge. Research on sex and gender differences in entrepreneurship
needs such a theoretical overview if future studies are to be reconciled with previous ones,
and if progress is to be made in understanding the extent to which relevant differences exist
and what, if anything, should be done to address them.
Sexton and Bowman-Upton (1990) recently made a start toward introducing greater
rigor in this area by outlining some of the major theories about sex-related discrimination.
Much, however, remains to be done to develop our understanding of (1) relevant sex- or
gender-related differences in personal characteristics and firm performance and (2) the related
issue of the nature, extent, and implications of sex-based discrimination. This article intro-
duces two major theoretical perspectives drawn from the feminist literature and draws on
them to consolidate the previous research on sex and gender in the entrepreneurship literature.
These two perspectives, liberal feminism and social feminism, arose from similar motiva-
tions: to understand the bases of, and work toward the elimination of, the lesser status of
women in society. They draw, however, on distinct theoretical underpinnings and contain
distinct views on the origins, nature, and implications of male/female differences. The
alternative viewpoints these theories provide are useful in raising sensitivity to some per-
sistent, unquestioned assumptions that seem to be latent in past entrepreneurship research.
Such assumptions may account for the frequent “null findings” and apparent empirical
discrepancies that have been reported. Reviewing past studies in light of these two theories
also helps to clarify what research is required to fill in gaps in our knowledge and develop
a firmer basis for managerial and policy decisions related to male/female differences in
entrepreneurship.
The article proceeds by outlining the key distinctive aspects of liberal feminist and
social feminist theories. Because the focus of this article is on consolidating past research,
the emphasis is not on exploring detailed nuances of the theories but rather on showing how
each relates to previous work, and on tracing out further hypotheses that arise from such a
review. The article describes a study undertaken to test these hypotheses. Finally, it suggests
some implications of the theories and findings for researchers and practitioners.

LIBERAL FEMIMST AND SOCIAL FEMINIST THEORIES

Agreement is far from complete on how the numerous diverse versions of feminism should
be grouped and characterized. There is, however, some consensus that liberal feminism and
154 E.M. FISCHER ET AL

social feminism constitute two of the major distinct categories of feminist thought (cf. Black
1989; Jaggar 1983).
Liberalfeminism (hereafter referred to as LF) is rooted in liberal political philosophy.
This philosophy encompasses basic beliefs in the equality of all beings, and in human beings
as essentially rational, self-interest-seeking agents. Rationality is assumed to be a purely
mental capacity, and is regarded as what is especially valuable about human beings. Indi-
vidual psychological differences resulting from differences in social opportunities are ac-
knowledged, but rationality, the human essence, is viewed as a capacity for which every
human being has the same potential.
LF, then, is based on the premise that women are equally capable of rationality and
thus are as fully human as men. The theoretical explanation for observed differences in the
achievements of men and women is that women have less frequently realized their full
capabilities only because they were deprived of essential opportunities such as education.
Observed psychoiogicai differences are posited not to be innate, but rather grounded in the
ways that women’s socialization discourages them from developing their full capacities for
reason. Physical differences between men and women are regarded as irrelevant, as rationality
is seen as having no physical basis, and women and men are assumed to be equal in their
rational capacity.
LF hypothesizes that as women gain access to equal opportunities, women and men
will actualize their potential rationality more equally and thus observed psychological dif-
ferences will diminish or disappear, resulting in widespread androgyny. An implicit as-
sumption of LF is that women will evolve to become more like men, because the basis for
any extant difference is taken to be women’s relative dep~vation. Before this can happen,
LF argues that both legal discrimination and the more insidious forms rooted in tradition
must be identified and eradicated. For instance, the tendency for women to be encouraged
to take less “practical” types of education and to enter jobs that require fewer technical skills
is seen to diminish their opportunities for acquiring experience conducive to founding and
running larger, financially more lucrative firms.
Social feminism (hereafter referred to as SF) has somewhat more diverse theoretical
roots, ranging from social learning theory to psychoanalysis. SF holds that there are dif-
ferences between males’ and females’ experiences from the earliest moments of life that
result in fundamentally different ways of viewing the world. It argues that female experiences
are an equally valid basis for developing knowledge and organizing society (Calas and
Smircich 1989). In contrast to LF thought, men and women are not considered essentially
the same; among men and among women, shared experiences are assumed to help define a
group-based rationality or mode of knowing. Neither the male nor the female mode of
knowing is regarded as innately superior or more functional for society. Further, feminists
in this tradition tend to subscribe to the view that “distinctions of gender, based on sex,
structure virtually every aspect of our lives and indeed are so all-pervasive that ordinarily
they go quite unrecognized” (Jaggar 1983, p. 85).
It should be noted that, largely through the insights of SF, a distinction between sex
and gender is now widely recognized. A person’s sex is regarded to be based strictly on
those physiological differences that make them either male or female. A person’s gender,
however, is based on differences in social experience, which typically begin to occur from
the moment of birth, due to caregivers’ reaction to the observed sex of a child (cf. Chodorow
1978). It must be noted, though, that caregivers and others who interact with a person
throughout their lifespan will vary somewhat in their reactions to a male versus a female,
 SEX, GENDER, AND ENTREPRENEURSHIP 155

and thus a person’s gender is not completely determined by their sex. That is, there will be
considerable within-sex, as well as between-sex, variation in experiences.
Due to the deep cultural embeddedness of experiential differences for women and
men, androgyny is generally not considered feasible in SF. Neither is it considered desirable;
a central premise of SF is that, although women’s experiences and ways of knowing have
been denigrated, their knowledge may be conducive to equally societally functional behav-
iors. SF posits that it is essential to recognize the ways in which knowledge is gendered
and to gain legitimacy for that feminine knowledge that has been suppressed or marginalized.
This involves both identifying gender differences and exploring their implications for in-
dividual behavior and societal well-being.

PREVIOUS RESEARCH
Much of the foregoing research on sex and gender pertaining to North American or British
samples can be classified as consistent with either LF or SF. Some studies (e.g., Kalleberg
and Leicht 1991) appear to test certain hypotheses consistent with each theoretical position.
The hypotheses derived from these theories need not be logically contradictory as LF and
SF are not in complete conflict despite their differing assumptions about the bases and
implications of male/female differences.

Research Consistent with LF

Research that is implicitly consistent with LF tacitly assumes or explicitly seeks evidence
of overt or systemic sex-based discrimination. Several studies that have looked for evidence
of sex-based discrimination have not included men as respondents. Rather, women alone
have been questioned about their characteristics and experiences, and their perceptions of
discrimination have been assumed to be accurate (see, for instance, Belcourt et al. 1991;
Goffee and Scase 1983; Hisrich and Brush 1984). Latent hypotheses that women are relatively
disadvantaged cannot, however, be tested empirically when men are not included as re-
spondents. Thus, such studies can only help to develop hypotheses relevant to LF by
suggesting the obstacles that may exist. The most common beliefs discerned regarding
disadvantages women entrepreneurs face include the following

1. They receive unequal treatment when they deal with lenders and other resource providers
(Belcourt et al. 1991; Goffee and Scase 1983; Hisrich and Brush 1984; Humphreys and
McClung 198 1; Stevenson 1986).
2. They are less likely to have a relevant education (Belcourt et al. 1991; Hisrich and Brush
1984; Watkins and Watkins 1983).
3. They are less likely to have relevant management, industry, and entrepreneurial expe-
rience (Belcourt et al. 1991; Hisrich and Brush 1984; Watkins and Watkins 1983).

It should be noted that while the first suggestion points to overt discrimination against women,
the latter two point to more systemic disadvantages that women may face.
Empirical studies that actually compare women with men, either by documenting
resource providers’ (i.e., lenders and consultants) perceptions of female versus male entre-
preneurs or by studying female and male entrepreneurs empirically, can be used to draw
more concrete inferences regarding the overt discrimination posited by LF. These studies
offer limited evidence of overt discrimination against women entrepreneurs by resource
156 E.M. FISCHER ET AL

providers. Buttner and Rosen (1988) did find that bank loan officers perceive men to have
significantly more of the characteristics of successful entrepreneurs than do women. How-
ever, Buttner and Rosen (1989) found that, in an experimental setting, loan officers were
not more likely to extend loans to hypothetical male entrepreneurs than to hypothetical
female entrepreneurs to whom identical business plans were attributed.
In a direct empirical comparison of experiences obtaining bank loans, Riding and Swift
(1990) found that when a sample of males and females matched according to business age,
size, growth rate, and organizational form were compared, lenders showed no difference in
rates of loan approvals, cosignature requirements, requirements for loan collateral, and
interest rates on loans and lines of credit. The only apparent sex-based difference was that
women were given higher collateral requirements for lines of credit. A study of “pre-
entrepreneurial” men and women who received consulting advice from a small business
development center showed that the two groups were virtually identical in terms of the
amount and type of assistance they received, their satisfaction with that assistance, and their
propensity to initiate ventures after receiving advice (Chrisman et al. 1990). Taken as a
whole, these studies suggest that women may experience relatively less overt discrimination
than has been suggested. However, Reuber, et al. (1991) did detect some evidence that
consultants may unconsciously offer different types of guidance to female versus male
entrepreneurs. Presented with descriptions of the same business problem facing a man versus
a women, the consultants they studied offered a greater quantity of advice to women, but
offered more complex advice to men.
Studies relevant to the question of systemic biases that may work against women
include those that empirically compare educational and experiential opportunities of men
versus women. With regard to education, Birley et al. (1987) found no significant differences
in the education of men and women who had enrolled in small business training courses.
Evidence based on this small, non-random sample of pre-entrepreneurs, however, does not
fully address the question of whether actual male and female entrepreneurs differ in regard
to education or experience, or whether these differences are associated with success. While
a number of “women-only” studies have speculated that men and women entrepreneurs have
approximately equivalent education (cf. Hisrich and Brush 1984), there is still little empirical
evidence that this is true.
With regard to business experience, Birley et al. (1987) found that their sample of
pre-entrepreneurs did not differ in prior experience. Kalleberg and Leicht (1991), however,
found that women in three industries (restaurants, computer sales and software, and health-
related businesses) tended to have less industry-specific experience and to have started fewer
businesses, but that equal numbers of men and women had been self-employed prior to
starting their own business. Interestingly, these authors found no difference in the likelihood
that men’s and women’s firms would survive or succeed. Given evidence that the number
of new ventures an entrepreneur has been involved in is related significantly to firm per-
formance (e.g., Stuart and Abetti 1990), it is curious that the men’s and women’s firms in
all three industries were equally likely to survive and grow. It must be noted, however, that
the measures of experience (number of years an individual had been in an industry and
whether or not the individual had been self-employed before acquiring current business) and
of success (growth in the logarithm of gross earnings) used by Kalleberg and Leicht are not
as extensive as those found elsewhere in the entrepreneurship literature; this measurement
limitation may be related to the “no difference in success” finding. Taken together, these
studies relevant to the systemic disadvantages posited by LF are inconclusive. Those that
 SEX,GENDER,AND ENTREPRENEURSHIP 157

offer some direct empirical evidence comparing men and women are either based on non-
representative samples or offer mixed evidence.

Research Consistent with SF

Research consistent with SF implicitly or explicitly posits that there are inherent differences
in the traits and/or experiences of men and women that give rise to differences in observed
entrepreneurial behaviors or outcomes. Values are one category of psychological difference
that has been explored. Fagenson (1990) compared male and female entrepreneurs and
organizational employees with respect to their scores on the Rokeach value survey. She
found that the majority of terminal values (e.g., compassion) and instrumental values (e.g.,
self-actualization) were not statistically different for male and female entrepreneurs; most
significant differences found were related to occupation (entrepreneur versus employee) rather
than to gender.
Sexton and Bowman-Upton (1990) looked at a range of psychological characteristics
including tendency to conform, energy level, interpersonal affect level, risk-taking pro-
pensity, social adroitness, value placed on autonomy, value placed on change, tendency to
avoid harm, and need for succorance. They did find some significant differences in personal
values, noting that relative to women, men scored lower on value placed on autonomy and
change. They also found that men scored higher on energy level and risk-taking propensity.
They concluded, however, that there is greater similarity than difference between male and
female entrepreneurs as many of the other bases on which they compared them showed no
significant differences.
Male and female entrepreneurs also have been expected to differ in their level of self-
confidence (Birley 1989). Kalleberg and Leicht (1991), however, found no difference in
either the self-confidence or the internality of locus of control between the 878 men and
261 women entrepreneurs they studied. In terms of management strategy, they found male
entrepreneurs likely to offer a wider range of products and services and women entrepreneurs
more likely to emphasize quality. The male and female respondents were equally likely to
characterize their strategy as based on innovation.
Other potentially relevant differences have not been examined through direct com-
parisons of male and female entrepreneurs within a single study. For instance, entrepreneurial
motivations have not been directly empirically compared for men and women, although
male/female differences in these traits have been posited (Bowen and Hisrich 1986). Ex-
trapolating from gender differences in socialization, women might be expected to be less
opportunistic and more craft-oriented, drawing on Smith’s distinction (Smith and Miner
1983).
Although the amount of literature investigating male/female differences has been mod-
est, it generally tends to suggest that there are few significant differences in characteristics
relevant to entrepreneurship. As these studies largely stop short of examining the relationship
of differences that do exist to business performance, it is difficult to assess how important
to business outcomes any extant differences may be. Only Kalleberg and Leicht’s (1991)
recent study, which fortunately used a relatively large and representative sample, sheds some
light on this question. They hypothesized and found, consistent with an SF perspective, that
women and men manifest at least one difference in strategic thinking: they differ in their
emphasis on product range versus product quality. However, they report that, in the three
industries they studied, men’s and women’s businesses are equally likely to survive and be
1% E.M. FISCHER ET AL.

successful. This suggests that whatever male/female differences exist in these groups are
not determinative of business performance.

Discussion of Previous Findings

This literature review illustrates that most studies can be categorized as having implicit
assumptions consistent with either LF and SF theories. To the extent that these studies’
results may be taken as tests of LF theories, they provide mixed evidence that discrimination
(overt or systemic) against female entrepreneurs is pervasive. Insofar as LF hypotheses
concerning systemic disadvantages faced by women are supported, Kalleberg and Leicht’s
(199 1) study calls into question whether these disadvantages are sufficiently great to cause
women to be less successful in business.
Equally limited support may be inferred for hypotheses concerning socialized gender
differences, consistent with SF. Only a few psychological differences have been detected
when samples of men and women have been directly compared. There is some support for
the SF hypothesis that women will not perform in a fashion inferior to men simply because
they differ; the Kalleberg and Leicht study suggests that male/female differences in product
range and product quality emphases are unrelated to business performance.
As was noted above, however, Kalleberg and Leicht’s study used rather limited mea-
sures of business performance. Their findings should not, therefore, be considered conclusive
evidence either that systemic disadvantages faced by women do not impact business per-
formance, or that male/female differences are unrelated to business performance. This sug-
gests that a study that, like Kalleberg and Leicht’s, uses a large representative sample, but
that also uses a wider range of measures of success would be useful in order to consolidate
and extend past research findings.
Moreover, the literature review above points out the need for a study to examine certain
implicit hypotheses, consistent with either LF or SF, that have been inadequately addressed
in empirical entrepreneurship studies. Three hypotheses derived from the extant literature
are discussed below.

LF-Hl: Women will have less entrepreneurially relevant formal education than men, and
their firms will therefore be less successful.
Following LF, because women are systematically less likely to have access to valuable, self-
potential-maximizing opportunities, they will be less likely to obtain the same degree of
relevant formal education that would help them in running their own businesses.

LF-HZ: Women will have less entrepreneurially relevant experience than men and their
firms will therefore be less successful.
Again, because women are systematically less likely to have access to valuable opportunities,
they will be less likely to obtain the same amount of relevant experience that would help
them in running their own businesses.

SF-Hl: Women will differ from men in their entrepreneurial motivation, a trait previously
linked to entrepreneurial success.
 SEX, GENDER, AND ENTREPRENEURSHIP 159

The different socialization men and women are subjected to due to their observed sex will
condition them to differ in many characteristics, including motivations generally considered
relevant to entrepreneurship.
The study reported below both builds on Kalleberg and Leicht’s work and tests these
hypotheses.

STUDY OVERVIEW AND METHODOLOGY

To consolidate and extend our understanding of sex, gender, and entrepreneurship along the
lines discussed above, this study was designed so as to include extensive measures of both
education and experience that could pick up subtle but pervasive systemic cons~aints on
women. An attempt also was made to use a psychomet~cally valid measure of entrepreneu~al
motivations that could be simply and readily scored. Further, a range of criterion business-
performance measures was included so that relationships between sex or gender differences
and business performance could be carefully examined. Attempts also were made to ensure
that a sufficiently large and representative sample was obtained to allow for valid male/female
comparisons.

Sample
A random sample of 908 manufacturing firms (split equally between food and furniture
manufacturers), 908 retail firms (split equally between food and furniture retailers), and 908
service firms (split equally between computer services and m~agement and public relations
services) was obtained from Dun and Bradstreet. The industries within each sector were
chosen based on the assumption that if women were to be found in the sector, they would
be more likely to be concentrated in these industries than in many others. Although this
data source provides one of the best-defined populations of entrepreneurial firms currently
available (Kalleberg et al. 1990), it has the limitation of a lag in listing new businesses,
which results in a bias toward older firms (Aldrich et al. 1989). To address this, the sample
was drawn disproportionately from newer firms, with 10% of the sample one year old or
less. In addition, firms were excluded from selection if (1) they had parent companies,
branches, or subsidiaries (thus excluding firms where the owner-manager is more likely to
be controlled externally); or (2) their Dun and Bradstreet record had not been updated in
the preceding 16 months.
The final usable sample consisted of 136 (11 female) manufactu~ng firm owners, 156
(29 female) retail firm owners, and 216 (20 female) service firm owners, with response rates
of 14.9%, 17.9%, and 23.8%, respectively. These response rates are low, despite the fact
that a follow-up postcard was sent one week after the questionnaires were mailed in an effort
to increase response rates. Low response rates were expected, and reflect the unwillingness
of entrepreneurs to respond to lengthy mail surveys. The initial samples drawn were large
in anticipation of low response rates, and the aggregate numbers are sufficient for statistical
analyses. To assess the representativeness of this sample, data obtained from Dun and
Bradstreet for all firms contacted was used. Characteristics on which responding firms (i.e.,
the sample obtained) versus all firms contacted (i.e., the sampling frame) could be compared
using Dun and Bradstreet data included number of employees, sales, geographic location,
sector, and year of start-up. At the .05 level of significance, the sample did not differ from
the sampling frame with respect to number of employees, level of sales, or geographic
location. However, there was a significant difference between the sample and sampling frame
160 E.M. FISCHER ET AL.

with respect to year of start-up and sector: younger firms were overrepresented in the sample
relative to the sampling frame, service firms are overrepresented, and manufacturers are
underrepresented. The low response rates, coupled with these biases in the sample, suggest
that caution be exercised in overgeneralizing findings of this study, particularly to very
mature firms or to firms in the manufacturing sector.

Procedure
The survey and cover letter were
instructions said: “Please fill this
owns this business, it should be
strategic direction.” Completed
addressed envelope.
mailed to the firm owners at their business addresses. The
out if you are the business owner. If more than one person
filled out by an owner responsible for managing the firm’s
questionnaires were returned in an enclosed postage-paid

Measures
Education
Education was measured first by asking “What is the highest level of education you have
obtained?” and offering respondents the options ranging from “grade school,” to “graduate
degree.” To more fully explore education, they also were asked “Have you had any prior
education (courses or seminars)” in each of six functional areas: marketing; finance; per-
sonnel; accounting; production; and business strategy? For each functional area, subjects
could respond: “a little,” “some,” or “a lot.” These categories, while not as precisely
differentiated as ideally would be desirable, should capture respondents’ relative levels of
training in each area.

Experience
Experience was measured in several ways. Respondents were asked how many years, in
total, they had owned a business of any kind; how many years they had operated their current
business; how many years, in total, they had been responsible for managing employees;
how many years they had worked in other firms with a product or service similar to their
current firms’; and how many new businesses, in total, they had helped to start-up.

Motivation
Motivation was measured using several items reflecting the range of entrepreneurial moti-
vations listed in the literature, including but not limited to the opportunist versus crafts
motivations (Smith and Miner 1983). These items had been previously developed and pre-
tested by the authors in a previous study of a non-random sample of 104 business owners.
(A working paper on this measure is available from the authors.) In both the pre-test and
this study, the 15 questions regarding motivations for starting or being in business loaded
on five factors with an eigenvalue greater than 1 in factor analyses.
The first factor was labeled “financial motives” and consisted of four items with a
factor loading of greater than .5 (one item with a loading of less than .5 was dropped from
further analysis), each relating to making the business more profitable or valuable. The
second factor was labeled “lifestyle motives” and consisted of three items each relating to
 SEX, GENDER, AND ENTREPRENEURSHIP 161

TABLE 1 Factor Loading for Items Measuring Entrepreneurial Motivations

Factor 3
Factor 1 Factor 2 Social
Financial Lifestyle Recognition
Item Wording Motives Motives Motives

Please indicate the importance to you of each of

the following goals

Making my business grow. .68605 - .12977 .21632

Increasing the profitability of my business. .78192 .02636 .12051
Earning a good living from the business. .54352 .23744 .08645
Improving my product or service. .54837 - .03081 .13154

Achieving a balance between work and family. .01128 .66758 .16643

Spending more time in leisure activities. -.01155 .67031 .08565
Avoiding high stress in my life. .00174 .76304 .01263

Making my name known in the community. .22240 .29572 .54694

Building something to pass on to my heirs. .01454 .14814 .61115
Diversifying my range of business activities. .06288 - .03387 .72866
Expanding my professional network. .17889 - .04647 .70989

enhancing quality of life outside of work. The third factor was labeled “social/recognition
motives” and consisted of four items pertaining to increasing reputation or connections in
the business community. The fourth factor was labeled “intrinsic motives” and contained
two items related to being challenged by and enjoying work. The final factor, a single item,
was labeled “independence motive” and related to being one’s own boss. The internal
consistency reliability (coefficient o) for the four multiple item factors was .62, .59, .62,
and .42, respectively. These reliabilities are modest, due both to the preliminary state of
development of the scale and the small number of items, particularly in the fourth factor;
the reliabilities of the first three are acceptable for research of this kind (Nunnally 1970).
The semantic correspondence of the first factor to the opportunistic orientation, and of the
second and third to the craft orientation, seem also to suggest that these factors have some
validity. The item loading on each of the first three factors were, accordingly, formed into
subscales to assess dimensions of entrepeneurial motivation. The items in the other two
factors were dropped from further analysis because of their questionable reliability. The
factor loadings for those items that were used in the analysis, grouped according to the
subscales developed, are displayed in Table 1.

Business PerJorrnance
Business performance was assessed using four categories of indicators collected from the
sample. The first category was size, and included measures of total number of employees,
current income, and current sales. The second category was growth, and included measures
of change over two years in number of employees, income, and sales. The third category
was productivity, and included calculations of income per employee and sales per employee.
The final category was returns, and included calculations of income per owner and income
per sales (i.e., margin). To ensure that industry heterogeneity within sector did not affect
the results of analyses that involved these performance indicators, each indicator was con-
162 E.M. FISCHER ET AL.

TABLE 2 Comparisons of Females and Males on Education Variables

Males Females
Mean SD Mean SD

General education0 3.3 I.3 3.5 1.2

Marketing educationh 1.7 .8 I.6 .9
Finance eduatio# 1.7 .8 I.5 .9
Personnel educationb 1.5 .8 I .4 .9
Accounting educationb 1.7 .8 1.8 .9
Production educatio& 1.5 .8 1.1 .6’
Strategy education” 1.8 .8 I.6 .9

“Measured as a continuous variable with a highest score of 6.

*Measured as a contina~us variable with a highest score of 3.
‘i test of female/male difference significant at .Ot level.

vet-ted to a standardized (z-score) measure representing the firm’s performance relative to

other firms in the same industry and sector.

Analyses
To test the hypotheses, t tests comparing means for male and female subjects on all education,
experience, and motivations measures were first conducted. Then, t tests comp~ing means
for males and females on all performance indicators were undertaken. Finally, regressions
using as independent variables the experience, expertise, and motivation measures that
differed significantly for men and women were performed for each performance indicator.’

RESULTS
Table 2 shows the comparisons of females and males with respect to education. It indicates
that there were few significant sex differences in education, other than that men had more
production-related business education.
Table 3 reflects female/male comparisons on the experience variables. Female/male
differences in relevant experience are more pronounced. Overall, men appear to have spent
more years m~aging employees, to have had more experience in similar firms, and to have
he&d to start more businesses.
Table 4 shows the results of comparisons of female and male motivations for business
owners in all sectors. The only significant difference is that women have stronger financial
motivation. This suggests that, relative to men, women are somewhat more opportunistically
oriented but no more craft-oriented. This result is somewhat unexpected.
Table 5 displays the results of comparisons of females’ and males’ business perfor-
mance for each category of variables. In the size category, men’s businesses consistently
outperform women’s; their firms have more employees, higher annual sales, and higher
annual income. In the growth category, men’s firms exhibited a higher two-year growth in

‘At the suggestion of one reviewer, information on marital status, number of children, and age also was
analyzed. Analyses of variance revealed no signi~c~t differences between males and females with respect to age
or number of children. but showed that men were significantly more likely to be married. However, marital status
showed no relationship to any performance indicator in analyses of variance.
 SEX, GENDER, AND ENTREPRENEURSHIP 163

TABLE 3 Comparisons of Females and Males on Experience Variables

Males Females
Mean SD Mean SD

# Years owned a business 11.9 8.5 10.3 7.3

# Years owned current business 8.6 7.3 7.3 6.5
# Years managed employees 15.9 9.7 11.1 7.5”
# Years in similar firms 4.0 5.7 1.9 4.76
# Firms helped to start 2.8 2.6 2.0 2.6’

‘1 test of female/male difference significant at ,001 level.

‘9 test of female/male difference significant at .Ol level.
‘t test of female/male difference significant at .OS level.

income. In terms of productivity, men’s firms exhibited higher levels of sales per employee.
There were no differences between the returns exhibited by men’s and women’s firms.
Table 6 illustrates the results of multiple linear regressions (with all variables forced
to enter) predicting the performance variables. Note that the independent variables included
in regressions are only those on which men and women in the sample were found to differ
significantly. as only these variables, if any, should explain dz&wzces in women’s and
men’s firms’ performance. Note also that the education and motivation variables were scaled
as metric variables for purposes of analysis.
As can be seen, across all the regressions, the education, experience, and motivational
variables on which men and women were found to differ together account for an almost
negligible portion of the variance in firm performance. The production education variable
is positively related to number of employees (on which men’s businesses outperform wom-
en’s) but negatively related to change in income over two years (on which men’s firms also
outperform women’s). Thus, having more education in production does not seem to provide
men with a clear advantage. Similarly, while men have more experience managing em-
ployees, this seems if anything to be a disadvantage to them, as this variable is negatively
related to change in employees over two years and change in sales over two years. Men’s
greater number of years spent in a similar business does seem to contribute to the better
performance of their firms in terms of size; years in similar business is positively related to
annual sales and annual income; moreover, the same variable is positively related to income
per employee, sales per employee (on which, again, men’s firms outperform women’s), and
income per owner. Having greater experience in helping to start firms also appears to be an
asset to men, given that the number of firms an individual helps to start is positively related
to number of employees and annual sales.

TABLE 4 Comparisons of Females and Males on Motivation Variables

Males Females
Mean SD Mean SD

Financial motivation’ 24.9 2.8 25.7 2.2b

Lifestyle motivation’ 15.0 3.5 15.5 3.8
Social/recognition 16.8 5.2 16.0 4.5
motivationC

“Highest possible score: 28.

“r test of female/male difference significant at .05 level.
‘Highest possible score: 21.
164 E.M. FISCHER ET AL.

TABLE 5 Comparisons of Females and Males on Business Performance Variables”

Females
Mean SD Mean SD

# of Employees 1.0 - .2 I+
Annual sales 1.0 - .3 .4“
Annual income 1.0 ~ .2 .5b
2-year change in employees .9 .O 1.2
2-year change in sales I .o - .o .9
2-year change in income 1.0 - .2 .@
Income per employee .9 .I .9
Sales per employee 1.0 - .3 .4‘
Income per owner 1.0 ~ .I .5
Margin I.0 - .o .7

“Using L-scares standardized by sector.

‘t test of female/male difference significant at .05 level.
‘I test of female/male difference significant at ,001 level

DISCUSSION
The particular LF and SF hypotheses tested here received mixed support. The prediction of
LF-H l-that women would have less access to relevant education-is not supported in terms
of general education. The only significant difference in relevant education appears to be that
men have more production training than women. Whether or not this extra training benefits
men is questionable, as production education is positively related to one performance variable
(number of employees) but negatively related to another (change in income over two years).

TABLE 6 Standardized Regression Coefficients

# Years # Years # Firms

Production Financial Managed in Similar Helped R2 for
Education Motivation Employees Business Start Regression

# Employees .09” - .05 .02 .03 .15b .03

Annual sales .07 .oo .06 .19h .I0 .06
Annual income .06 .04 .01 .25” .02 .07
2-year change .08 .02 -.lW .02 .02 .Ol
in employees
2-year change - .Ol - .oo - .13’ .OO .03 .Ol
in sales
2-year change -.ll” .02 - .06 - .Ol .Ol .01
in income
Income per .05 .04 .OO .25’ .OO .06
employee
Sales per .02 .05 .05 ,216 - .oo .05
employee
Income per .06 .04 .OO .25’ .01 .07
owner
Margin - .Ol .lo” - .07 .04 .02 .Ol

“Coefficient significant at .05 level.

bCoefficient significant at .M)l level
‘Coefficient significant at .Ol level.
 SEX,GENDER,ANDENTREPRENEURSHlP 165

The prediction of LF-H2-that women would have less access to experience-appears

to be somewhat more substantiated; women did have less experience than men in managing
employees, working in similar firms, and helping to start other businesses. The fact that
managing employees is negatively related to change in employees and change in sales over
two years suggests that women’s relative lack of experience in this area is not impeding
their performance. The findings that years in similar business is positively related to annual
sales, income, income per employee, income per owner, and sales per employee, and that
the number of businesses a person has helped to start is positively related to number of
employees and annual sales, offer more support for this hypothesis. They suggest that women
are disadvantaged to the extent they are subject to systemic forces that lessen their oppor-
tunities for such experiences.
The prediction of SF-Hl-that there would be between-sex differences in motivation-
received some support. Women did differ from men in that they had greater financial
motivation. However, this finding is somewhat surprising in that most social feminist theory
suggests that women might, if anything, be more lifestyle-oriented (in keeping with having
a greater concern for the well-being of other people in their lives). It might be argued,
however, that women entrepreneurs exhibit stronger financial motivations because having
greater financial success is important to their ability to take care of their dependents. Al-
ternatively, it may be that, relative to the general population of women, those drawn to
entrepreneurial careers have stronger financial motives. In any event, the fact that financial
motivation was significantly related to only one performance variable (margin) suggests that
this character difference has a modest effect on any behaviors that affect performance.
Taken together, these findings offer some insights into why men’s firms may outperform
women’s (primarily in terms of size); women’s relative lack of experience is a factor, although
the small percentage of variance explained in each criterion variable suggests that other
factors also must be considered. From an LF perspective, it would be logical to consider
relevant opportunities other than experience or education that are systematically less available
to women and that impede them from starting large firms or growing their firms rapidly.
From an SF perspective, it would make sense to explore psychological gender differences
(other than motivations) that may explain either why women are more likely to prefer smaller
firms or why they are predisposed to start smaller firms.
It also is worth noting that, although women lack the experience in similar firms,
which is positively related to income per employee and income per owner, their firms do
not perform poorly relative to men’s on these measures. The possibility that women’s
socialization leads them to manage their firms in a way that offsets the impact of lesser
exposure to similar businesses (which would be consistent with SF theory) is an interesting
one. However, this possibility is merely speculative and would require more research to
substantiate or disconfirm.

CONCLUSIONS
The theoretical perspectives introduced in this study help to organize both assumptions and
findings from the foregoing research on sex, gender, and entrepreneurship. They also offer
guidance as to how to explore these topics further without resorting to atheoretical attempts
to explain puzzling data.
While performance differences exist and the reasons for them need to be explored
further, some of the variables discussed in previous research either fail to differ as expected
or fail to relate to performance as expected. Further exploration based on LF theory would
f&i EM. FSCHER ET AL

Iead researchers to look for sources of overt or systemic bias against women chat have been
previously neglected. For instance, customer or supplier biases affecting their willingness
to do business with firms run by women might be studied. Studies based in SF would focus
on male/female differences that have not yet been explored. For instance, as Bowen and
Hisrich (1986) suggest, a logical next step would be to investigate gender differences in
management styles and how they may affect firm performance.
Some guidelines for future research arise from the insights developed in both LF and
SF theory:

I_ If the existence of maI~/female differences is being posited, empirical evidence cornicing

women and men drawn from the same p~pnlation at the same time is necessary; otherwise,
situationaf or temporal factors may invalidate ~orn~~i~ns between women studied in
one setting at one time and men studied in another setting at another time.
2. If evidence is being sought that hypothetical sex or gender differences exist and that they
are relevant to firm performance, then including criterion measures of performance as
well as independent measures of the differentiating characteristics in a single study is
necessary. Unless such measures are taken, and the appropriate analyses performed, it
is dangerous to speculate that differences that are detected are relevant to business
performance.
3, Similarly, if evidence of overt or systemic discrimination is argued to be relevant to the
relative business performance of men and women, studies should assess both opportunities
to which women are thon~ht to lack access and the aspects of business performance that
are thought to be affected. Otherwise, it may be incorrectty inferred that the op~~uni~es
to which women lack access actually prevent them from performing well in business.

It must be acknowledged, of course, that both LF and SF theory may not be substan-
tiated by future research; this may account for the mixed support found for hypotheses
derived from these theories thus far. However, before such a conclusion is drawn, it is
important to recognize that the studies reviewed above were not designed specifically as
tests of the LF and SF theories, and that the hypothesis tested in this research are not the
only ones that would be generated by a more sustained and systematic effort to apply these
theories in this domain. At least as a theoretical point of departure for future research, these
theories hold promise.
The empiricaf results of this study also make an incrementd contribution to the building
knowledge poet in this area. Particularly taken together with the results of KatIeberg and
Leicht (1991), they suggest that sex differences in in-class education may not be of criticaf
importance, However, these findings suggest that more investigation of men’s and women’s
differential access to ma&world experience is warranted, and that there may be as yet
undefined male/female socialization differences that lead men and women to run their firms
in different but equally effective ways.
A notable limitation of this study is the low response rate. The possibility that our
sample is unrepresentative in that it contains an unduly high proportion of those with the
time or willingness to respond must be acknowledged. Another issue may be the self-selection
of highly educated women into entrepreneurial ventures. Perhaps many women did or do
lack access to relevant education, and only those who were relatively privifeged in this
regard even attempt to start firms. and thus show up in the samples studied. These factors
constrain the genemIizabiIity and interpretation of findings. Nonetheless, the theories outfined
and the incrementat empirical findings gleaned are of value to those who wish to pursue
research in this area.
 SEX, GENDER, AND ENTREPRENEURSHIP 16’7

From a policy-maker’s perspective, this research suggests that the key resource they
might seek to provide potential women entrepreneurs is access to apprenticeship in the
industry in which they hope to set up their firms. From investors’ or lenders’ perspectives,
differential treatment of men and women would clearly be unwarranted. Although men’s
and women’s firms do differ in some aspects of performance, there is no strong evidence
that women’s firms are impeded by the owners’ relative lack of education or experience.
For entrepreneurs, this research suggests that for both men and women, the best way
they can prepare themselves to do business in a particular sector or industry is to gain
experience in that setting, and to seek out exposure to business start-ups.

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