Female Entrepreneurship: Evidence from Vietnam

ABSTRACTThe study investigates motivations, success factors, problems and business-related stress of Vietnamese women entrepreneurs. One hundred and seventy women business owners in Binh Duong and Binh Phuoc provinces were randomly selected for a survey. Findings show that the two most important reasons for business ownership are to increase income and to be one 's own boss. Friendliness to customers and good location are considered the leading factors for business success. The most critical problems encountered by Vietnamese women entrepreneurs are reported to be competition and the inability to retain high quality employees. The entrepreneurs also indicate a low level of business-related stress. Results of the factor analysis suggest that women entrepreneurs would benefit from government support and financial market liberalization.INTRODUCTIONVietnam has experienced remarkable economic growth since it adopted the economic refonn policy known as "Doi Moi" in 1986. From 1990 to 2010, the economy grew at an annual average rate of 7.3%, even counting the recent economic downturn (World Bank, 2011b). The transition from a centrally planned economy to a market oriented economy has been accompanied by a thriving market of private enterprises. It is estimated that around 25 percent of business owners in Vietnam are women and the percentage of women-owned enterprises will reach 30% in 2015 (ILO, 2011). Women enterprises contributed significantly to the job creation and economic growth in Vietnam.Although women have gained increased economic opportunities, their productive potential is underutilized due to cultural values and an unfavorable business environment. Vietnamese culture is intertwined with Confucian philosophy. Tlie traditional expectation of a woman's role has been limited to taking care of family and doing housework. Men are relied upon to provide the main source of income for the household. Women entrepreneurs face the challenges of equal access to resources, finance and business training. Being aware of these barriers, the Vietnamese government has committed itself to promoting gender equality and women's empowerment over the past decade. The Gender Equality Law was passed in 2006 and aimed to improve women's roles in society, especially in business. It states that "women are equal in establishing new businesses, operating, trading and managing businesses, as well as in accessing information of fund, market and workforce"(Vietnam Women Entrepreneurs Council, 2007). While progress has been made, gender imbalance still persists in the labor market (World Bank, 2011a). Existing literature on Vietnamese women entrepreneurs mainly focuses on the barriers and difficulties they face in doing business. This study takes a broader perspective and examines key areas of motivation, success factors and problems related to women entrepreneurship in Vietnam. Improving women's employment is important for sustainable economic growth. This paper provides insights into the current status of women entrepreneurs and their needs. The findings will help policy makers build a support system for the development of women entrepreneurship.LITERATURE REVIEWEconomists classify limited resources into four groups: land, labor, capital, and entrepreneurship. Assuming that females account for about half of the population, women's contributions should be half of the labor for their work efforts, half of the capital in terms of human capital, and half of the entrepreneurship as their male counterparts. However, women's visibility in these resources is limited, and especially in developing countries, female contribution is underutilized. Vietnam, as a developing country, is no exemption. There may be several factors, ranging from political to personal, that prevent women from reaching their full potential. Given the importance of women among the limited economic resources, researchers have attempted various studies to explore these factors. …