Globalization in gender inequality and female entrepreneurship

Abstract Amid growing interest from both academic and policy communities in understanding how economic inequality influences global entrepreneurial activity—particularly among women—this study addresses two central questions: (1) What is the effect of gender-related economic inequality on female entrepreneurial activity? and (2) How does globalization shape this relationship? Drawing on the disequalizing model and rich-getting-richer theory, we constructed an unbalanced panel dataset of 60 countries spanning the period from 2014 to 2022. Using fixed and random effects panel models complemented by a series of robustness checks, our analysis reveals that gender-related economic inequality significantly decreases formal female entrepreneurial activity while simultaneously increasing informal female entrepreneurship. Furthermore, globalization moderates these relationships by enhancing women’s participation in formal entrepreneurship while reducing their involvement in informal ventures. By identifying the key mechanisms that drive female entrepreneurship, this research contributes to advancing Sustainable Development Goal (SDG) 5: Gender Equality and SDG 8: Decent Work and Economic Growth. Finally, we offer policy and managerial recommendations aimed at promoting the formalization of women-led businesses and reducing gender-based economic inequality.