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ABSTRACT
This paper explores the determinants and challenges affecting women sole owners of tourism-related enterprises. It identifies factors that determine sole ownership, assesses the extent to which women participate as sole owners and the challenges encountered in establishing and operating enterprises. Primary data on 475 women-owned enterprises is analysed using a probit model. We find that post-primary education, attendance of specialised training in tourism, engagement in other economic activities, and being previously employed reduces the likelihood of solely owning a business, while initiation of the business idea increases it. We recommend offering women entrepreneurial education to enable them acquire experience, develop right attitudes and foster networks for entrepreneurship. Furthermore, increasing awareness on availability and access to the Women Development Fund (WDF) and strengthening the enforcement of laws governing ownership of land could provide women with start-up capital and means to access formal loans that require collateral.
Acknowledgements
The authors acknowledge the generous support of the International and Development Research Centre (IDRC) funded collaborative research project on ‘Youth Employment and Women’s Economic Empowerment in Africa: The Role of SMEs in the Tourism Sectors of Mauritius, Tanzania and Uganda’ that enabled this study to be undertaken. The authors are indebted to two anonymous reviewers for their thorough comments and suggestions, which helped to improve the paper.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
1 It is important though to note that not all income generating activities provide positive effects on women’s status. Some studies have found that involvement of women in income generating activities means mere provision of labour especially for activities that men control in cultural settings where patriarchal norms are dominant. With added chores at home, women are often overwhelmed with work, resulting in time poverty (International Fund for Agricultural Development (IFAD) Citation2016).
2 Sole ownership refers to an individual owner who is in control of her own enterprise. The enterprise is unincorporated by a single individual, making it the simplest form of business to establish and run. A distinct feature that distinguishes it from other forms of legal ownership such as limited liability and partnership is the absence of legal separation between the business and the owner (see Ehrhardt & Brigham, Citation2011).
3 The underlying assumption is that the women’s enterprises become successful. In reality, the success of women-owned small and micro enterprises is not guaranteed. While some research findings indicate the more women-owned enterprise face a higher failure rate (Farlie & Robb Citation2009; Haupt & Ndimande Citation2019; Yang & Triana Citation2019; Kamberidou Citation2020), others show that the difference in success rates of men and women-owned enterprise is not significant (Watson Citation2003), and some find that female-owned enterprises out-survive male-owned ones when factors such as industry and location are accounted for (Kalnins & Williams Citation2014).
4 Social entrepreneurship is ‘the field in which entrepreneurs tailor their activities to be directly tied with the ultimate goal of creating social value. In doing so, they often act with little or no intention to gain personal profit’ (Abu-Saifan Citation2012).
5 TanzaniaInvest.com (Citation2021).
6 Given that most farmers rely on rainfed agriculture, the area under irrigation is less than 10 percent due to weak agricultural infrastructure (URT Citation2016a). The agricultural exports are also dominated by exports of agricultural products in their raw form, hence providing lower export earnings than if they were processed.
7 Although source of capital affects both men and women owned MSMEs in developing countries, studies indicate that women-owned enterprises face greater constraints when sourcing capital for start-up and for expanding their enterprises (International Finance Corporation (IFC) Citation2011). For instance, women owned SMEs were on average found to have less access to banking services, and were more likely to source their funding for their enterprises from their own savings, loans from families, friends, churches and microfinance institutions (IFC Citation2011; Brixiová & Kangoye Citation2019).
8 The need for women to be encouraged to access funds to build their enterprises has impelled some governments and international funding organisations to establish national funding programmes for women entrepreneurs. Affirmative action in funding for women entrepreneurs is important due to the funding gaps between men and women entrepreneurs that is prevalent even in the European Union (European Investment Bank Citation2020). Through the Affirmative Finance Action for Women in Africa (AFAWA), the African Development Bank launched a call for proposals for funding to augment the business and financial skills of SMEs owned by women, and to enable them to grow in order to create employment African Development Bank Citation2021, (https://www.afdb.org/en/news-and-events/press-releases/african-development-bank-invites-business-enablers-apply-funding-support-women-entrepreneurs-43569; accessed: November 2021).
9 In a study of Victorian entrepreneurship using census data, Van Lieshout et al. (Citation2019) found that the life cycle of a women, notably, marriage, motherhood and widowhood, were important in her decision to work, the type of work to take up, and whether to become an entrepreneur. In general, they found that while marriage and motherhood removed women from work, their effect on their levels of entrepreneurship was not much. The women who had young children were more entrepreneurial than those with none, and their entrepreneurial rates rose as more children came along.
10 The sections are: profile of the respondent; background of the business; operation of the business, its management and obstacles; the women’s economic role and control over assets; their involvement in decision making in the business and household; their time use; group participation; and social norms and stereotypes. The questionnaire can be requested from the Principal Investigator for the Tourism Project at the School of Economics, University of Dar es Salaam. Before embarking on data collection, research clearance was obtained through the Deputy Vice Chancellor’s office and the project was registered as CoSS-EC18025.
11 Simple random sampling was used by applying the numbers generated using the random number generator in Excel to the list of firms.
12 The study used start-up capital instead of current capital due to numerous gaps in the data, as most respondents could not provide the information.
13 The major goal of WDF is to empower women by enhancing their involvement in economic activities in the society (URT Citation2016b).
14 These are: selling of some assets, loan from spouse or partner, other family members, friends, commercial bank, micro-finance, money lenders, cooperative, gift of money from other family members, borrowed from friends, rotational credit, and fund from the government.
15 shows that 99 percent of women owned enterprises had a small start-up capital while the remaining 1 percent had a large start-up capital.
16 The probit is founded on standard normal distribution while the logit model is centered on standard logistic distribution. Practically, in some circumstances, for mathematical convenience, there are reasons for favouring the choice of one over the other, although it is difficult to justify the choice of one distribution over the other on theoretical grounds (Green Citation2012). However, in most cases, the choice between the two seems similar, the core distinction being that the logistic function has apparently flatter tails (the tails are heavier, it more closely looks like a t-distribution with seven degrees of freedom) (Gujarati Citation2004; Green Citation2012).
17 The LPM model suffers from various shortcomings that make the logit and probit model more superior to LPM: non-constant variance, the error term is not normally distributed and nonsensical predicted probabilities (Gujarati Citation2004).