## Closing Gender Gaps in India: Does Increasing Womens’ Access to Finance Help?

_IMF Working Papers, September 28, 2018_

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## Bibliographic details
- Authors: Purva Khera
- Published: September 28, 2018
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781484377468.001

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### Summary
- Gender gaps in women’s economic opportunities—labor market and entrepreneurship—have remained high in India.
- Lack of adequate collateral limits women entrepreneurs’ ability to access formal finance, leaving them to rely on informal sources and constraining their growth.
- A small-open economy DSGE model is built to investigate the long-run macroeconomic impacts from closing gender gaps in financial access.

### Key findings
- An increase in women entrepreneurs’ access to formal credit results in higher female entrepreneurship and employment, which boosts India’s output by 1.6 percent.
- Regulations and gender-specific constraints in the labor market limit potential gains because females’ access to quality jobs in the formal sector remains restricted.
- The factors influencing the number of females are different from those influencing the share of females in formal economic activity.
- Combining gender-targeted financial inclusion policies with policies that lower constraints on formal sector employment could boost India’s output by 6.8 percent.

### Model and methodology
- Analytical framework: small-open economy DSGE model.
- Focus: long-run macroeconomic impacts of closing gender gaps in financial access.
- Mechanisms emphasized: access to formal credit for women entrepreneurs, collateral constraints, reliance on informal finance, and labor market regulations and constraints affecting formal sector employment.

### Policy implications and recommendations
- Expand women entrepreneurs’ access to formal credit to raise female entrepreneurship and employment.
- Address regulatory and gender-specific labor market constraints to enable women’s access to quality formal-sector jobs.
- Pursue combined policy packages that link gender-targeted financial inclusion with reforms reducing barriers to formal employment to maximize output gains.

*IMF Working Paper: Closing Gender Gaps in India: Does Increasing Womens’ Access to Finance Help?*

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## Content in this bundle

- **wp18212 — Introduction, Model Overview, Calibration, and Gender-Specific Policies**
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_Source: https://www.imf.org/en/publications/wp/issues/2018/09/28/closing-gender-gaps-in-india-does-increasing-womens-access-to-finance-help-46251_