Impact of a credit project for women and men microentrepreneurs in Quito Ecuador.

Resumen

This study of the Ecuadoran Development Foundations microenterprise development program (PRODEM) established in 1984 states that female entrepreneurs productivity was increased due to access to credit. The strategies were benefits and justified for credit access to women microproducers in manufacturing and services as well as microvendors who were poorer. Gender was an important factor in interpreting short-term outcomes. That PRODEM was successful in reaching a large number of low-income female microproducers and microvendors who did not default was particularly significant because the program was operating during a period of recession which jeopardized the survival of the poorest families. Womens efficiency was increased and the work day was reduced from 10.3 hours in 1984 to 9.28 hours in 1985; net income was also increased. Kilbys observations were affirmed: that access to credit increased productivity as measured by hourly net income. The study affirms the importance of using measures of productivity in impact studies. Male entrepreneurs had larger firms than women and higher incomes. The income increases were measured after a baseline survey. Credit did not have an effect on increasing employment. Gender was an important explanatory variable in monthly net income but not hourly net income. Female microvendors increased their hourly revenues more than male microvendors. Women earned less than men regardless of their borrower status. The sample in 1984 included 311 microentrepreneurs: 156 borrowers (8.6% of program clients) and 155 nonborrowers. The sample included 32% of female microproducers in the program 14% of male microproducers and 6% of solidarity group members. Caution was urged in the interpretation of results because of the small sample sizes. PRODEM operated in Quito and increased womens participation in the program within the two years of operation.