Double Bind: Financial Constraints, Corruption, and Women’s Entrepreneurship in India

Women remain significantly underrepresented in entrepreneurship in India despite rapid economic growth. This paper examines how two structural barriers—financial constraints and corruption—separately and jointly affect women’s participation in firm ownership. Using nationally representative firm-level data from the World Bank Enterprise Survey, I estimate an endogeneity-robust probit model and compute interaction effects following Zhou and Li (Citation2021), enabling consistent identification of nonlinear interactions. Our findings show that both financial exclusion and corruption significantly reduce female ownership, and their interaction creates a compounded ‘double bind’ that disproportionately limits entrepreneurial entry and scaling. These effects are most pronounced in the manufacturing sector and among medium and large enterprises. The study highlights that financial and institutional frictions are mutually reinforcing, and piecemeal interventions are unlikely to close gender gaps. Integrated reforms that improve access to finance, strengthen institutional transparency, and establish gender-sensitive grievance mechanisms are essential to unlock women’s entrepreneurial potential.