EXPLORING THE INFLUENCE OF FEMALE OWNERSHIP ON BUSINESS TYPE AND CAPITAL AMONG SME’s: EVIDENCE FROM INDONESIA

Abstract

ABSTRACT

Many SMEs are initiated by women to support household economic needs, driven by necessity, the need for additional income, and a desire for business flexibility and autonomy. This trend reflects necessity-driven entrepreneurship, where women balance family responsibilities with income-generating activities. This study investigates the influence of gender on business type and capital among SMEs in Kecamatan Borobudur, Kabupaten Magelang, Indonesia, where female entrepreneurship plays a vital role in local economies. Using Chi-Square tests and Cramer's V, data from 1,018 SMEs were analyzed to determine whether gender significantly impacts business type and capital. The findings show statistically significant relationships, with Chi-Square values of 41.877 (p-value = 1.769×10−8) for business type and 36.918 (p-value = 4.788×10−8) for business capital, indicating that gender has a meaningful association with these variables. However, Cramer's V values of 0.2028 for business type and 0.1902 for business capital suggest that the effect sizes are small to moderate. This implies that while gender plays a role in shaping business decisions, it does not overwhelmingly determine the business type or capital structure. Notably, the data indicate that women entrepreneurs in the region are more likely to engage in certain business fields and access smaller amounts of capital compared to their male counterparts. The novelty of this research lies in its focus on SMEs in Kecamatan Borobudur, an underexplored area in gender and entrepreneurship studies. By examining gender’s influence on both business type and capital in this rural context, the study provides fresh insights into how female entrepreneurship operates in smaller, localized economies. It emphasizes the importance of considering gender in entrepreneurship research and calls for further exploration of how external factors, such as market conditions and personal expertise, interact with gender to shape entrepreneurial outcomes.

Keywords: Female ownership, business type, business capital, SMEs, Indonesia.