Climbing the poverty ladder: the role of entrepreneurship and gender in alleviating poverty in transition economies

ABSTRACT

Poverty reduction remains a critical issue for a vast proportion of the population globally. Substantial body of literature on poverty reduction has focused on the role played by government support and charity institutions, whereas entrepreneurship as a channel for poverty reduction, and the role of gender in shaping this relationship have been under-researched, especially in the context of transition economies. Using the recent wave of the EBRD Life in Transition Survey III (2016) data, this study explores the relationship between poverty alleviation, entrepreneurship and gender. We extend the understanding of the mechanism via which entrepreneurial process is likely to contribute to poverty reduction in this region, distinguishing between self-employment and business ownership, with the latter regarded as Schumpeterian entrepreneurship. The study provides some interesting findings shedding light on the important role women play in shaping the entrepreneurship-poverty relationship.

KEYWORDS:

• Income-poverty ladder
• subjective
• objective poverty
• entrepreneurship
• gender
• infrastructure
• transition economies

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. These figures reflect a group average for transition economies and are calculated based on 2015/2016 report. In the year of survey used for drafting this report, among transition economies there were the following countries that took part in the survey: Bulgaria, Croatia, Estonia, Hungary, Kazakhstan, Latvia, Macedonia, Poland, Romania, Slovak Republic, and Slovenia.

2. Here is a full list of countries comprising each of these groups: CEB: Croatia, Estonia, Hungary, Latvia, Lithuania, Poland, Slovak Republic, Slovenia. SEE: Albania, Bosnia and Herzegovina, Bulgaria, FYR Macedonia, Kosovo, Montenegro, Romania, Serbia. EEC: Armenia, Azerbaijan, Belarus, Georgia, Moldova, Ukraine. CA: Kazakhstan, Kyrgyz Republic, Tajikistan, Turkmenistan, Uzbekistan, Russia.

3. We also merged the third wave of the LiTS survey with the second one (2010). However, unlike the 2016, which offers measures of both subjective and objective poverty, the 2010 has only a subjective measure of poverty that prevents scholars to undertake full-scale comparisons across the two waves.

4. EBRD (2016) Life in Transition report III, available from litsonline-EBRD.com.