Economic freedom and female entrepreneurship

Abstract Economic freedom plays a crucial role in fostering economic activities by creating opportunities and reducing transaction costs. However, its impact on entrepreneurship often differs by gender. This study examines the causal relationship between economic freedom and the ratio of female‐to‐male entrepreneurship using the matching method. The findings reveal that economic reforms have no short‐term impact on the ratio but reduce the gender gap over time while supporting opportunity‐driven ventures in the short run. A larger government and sound monetary policies are positively associated with female entrepreneurship, whereas regulatory reforms demonstrate short‐term advantages but pose long‐term challenges.