Empowered by Truth? Correcting Misperceived Beliefs about Gender Norms and Stereotypes among Women Entrepreneurs

We investigate whether and how gender norms and stereotypes constrain women’s entrepreneurship, empowerment, and business decisions in Paraguay. Our study first maps out how actors on the value chain perceive women in business roles. We do so by eliciting beliefs about gender norms and stereotypes among suppliers, business associations, regulators, financial institutions, and buyers. This exercise documents considerable heterogeneity in beliefs across these five reference groups. Second, we conduct an information treatment in which randomly selected women entrepreneurs and aspiring entrepreneurs receive information about these reference groups’ beliefs. This intervention is inspired by the norm correction literature which documents signification misperceptions of beliefs. The premise of these interventions is that individuals tend to behave according to their beliefs of what others think (second order beliefs) and not what they themselves believe (first order beliefs). If female entrepreneurs believe, perhaps incorrectly, their peers, clients, financial institutions, and/or suppliers hold overly conservative views about women in business, they may sub-optimally invest the time and resources for their ventures to thrive. Our study thus aims to answer three questions. First, how do beliefs correlate with entrepreneurs’ agency, and self-confidence? Are these beliefs misperceived? Can an information treatment on gender norms influence beliefs and improve agency and business outcomes?