Analyzing the Role of Micro-Entrepreneurship and Self-Help Groups (SHGs) in Women Empowerment and Development: A Bottom-of-Pyramid Perspective

Analyzing the Role of Micro-Entrepreneurship and Self-Help Groups (SHGs) in Women Empowerment and Development: A Bottom-of-Pyramid Perspective

Veer P. Gangwar, Shad Ahmad Khan
DOI: 10.4018/978-1-6684-2349-3.ch011
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In India, societal development is a cynosure, and thus, it is not a truism but a reality. Women's entrepreneurship emerging through self-help groups (SHGs) contributes to the economic well-being, sustainability, and in poverty reduction. The growth of SHGs is evidence in itself. In the recent decade, micro enterprises and SHGs have come up as prominent solutions to the entrepreneurial crisis existing in the country, and their role in empowering women and their development needs to studied. This study uses a descriptive statistic, reliability, and correlation analysis through SPSS and structural equation modeling (SEM) as an analytical tool to explore linkages between empowerment effected by SHG and micro-entrepreneurship. The research study results show that the contributory role of women entrepreneurs to the society is considerably worth appreciation. The causal relationship has also surfaced demonstrating the connection between women empowerment and development brought about by SHG and micro-entrepreneurship from a bottom-of-pyramid perspective.
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Societal Development is strongly linked with the income generating capacity of its constituent members. In a country like India, it is not a truism but a reality. Though India has been demonstrating fair economic growth in the last couple of decades yet its rank in the Human Development Index (HDI) has not increased considerably; instead it has been centering round 130. Despite all this, one of the most important challenges being faced by India is eradication of poverty. The poverty is increasing chasm between male and female.

In terms to fight against poverty, encouragement of entrepreneurship among women, particularly of rural areas emerged as an effective way. New business is considered as a crucial driver of economy (Schumpeter, 1936). Entrepreneurship is often considered as a mechanism for socio-economic development, poverty reduction, and generation of employment (Galindo and Méndez-Picazo, 2013).

Omoruyi, (2017) shows that entrepreneurship positively explains the variations in the growth and further it is reasonable to contend that entrepreneurship in developing economies is instrumental to unlocking economic growth, create employment and reduce poverty.Employment creation in rural areas by launching entrepreneurship will help people to earn their daily bread and also result in inclusive growth.

The “Base of Pyramid (BoP) 2.0” model developed by London and Hart (2011) briefs about various openings even to the last person of the society in the pyramid model, aiming at earning US2$ per day. This concept helps us to give ideas for involving people who are in need of opportunities for their overall development and socio-economic progress of our country. In 2012, Hall, Matos, Sheehan, & Silvestrequoted that “Generating entrepreneurial opportunities for people at the base of the pyramid is important for inclusive growth”. In a country like India, generating employment facilities at BoP by undertaking various entrepreneurship/business activities will lead to the inclusive development of India and this will be more effective, if the employment creation is women-centric particularly in agriculture dominant areas.

Many researchers have proven that women played a key role in economic growth of the country and they will remain playing this major role in the future too. If there is equality between men and women, the economy can grow faster following the reduction in poverty.

Lortie,Castrogiovanni, and Cox (2016), reported that ‘n’ of firms launched and spearheaded by womenfolk for the last two decades have grabbed the attention of many practitioners and scholars. Such firms played an important role in proving that ‘gender’ has a greater impact on the social performance of any organization.

The Gross Domestic Product (GDP) growth rate measures the growth of the economy and economic output of a country. Many studies have reported that the GDP growth rate can be increased by as much as 34% in the countries, with increasing female-to-male employment levels. A report from the United Nations Industrial Development Organization (UNIDO) says—with women-to-men employment levels, the productivity may be increased by as much as 25%. The reason behind this is—when a woman starts earning, she spends her money to provide education to her children and to look after them in their needs, Doepke and Terlilt (2011) said adding that to stimulate economic growth, women create human capital as well as jobs.

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