Financial Constraints and Growth Trajectories of Women Entrepreneurs Through the Role of Human Capital in Business Development and Sustainability

Abstract

Women-owned firms make an important contribution to entrepreneurship and economic development; however, financial restrictions may limit their potential to develop and maintain business operations. Previous literature tends to consider financial access as a binary variable that limits understanding of the cumulative and interactive nature of financial constraints and their impact on various aspects of entrepreneurship. The present study fills this research gap by exploring how and under what conditions financial constraints affect the growth paths of women entrepreneurs in Oman. Quantitative data of 244 women entrepreneurs from Oman was analyzed through quantitative methods. Such analytical techniques as descriptive statistics, Pearson correlations, robust OLS regression, item-level constraint analysis, constraint-count analysis, configuration analysis, and moderation models were used. Due to missing values, the number of observations varied for certain analyses: N = 74 for item-level regression, N = 71 for constraint-intensity, configuration, and moderation models. Educational attainment had a positive and statistically significant effect on entrepreneurial success (β = 0.20, p = .003), while work experience had a positive yet marginally significant effect (β = 0.13, p = .060). Insufficient collateral (β = −0.252, p = .047) and credit history restrictions (β = −0.269, p = .036) had a significant negative impact on income growth. The strength of constraint had a negative correlation with income growth (ρ = −0.284, p = .014). The interaction between collateral and credit history had a significant negative effect (β = −0.186, p = .028). Human capital interaction effects were positive but insignificant. The results reveal that financial exclusion is not just an ‘either/or’ phenomenon but rather a cumulative and configurational one. Policies should target financing constraints and enhance women’s entrepreneurs’ human capital assets. Research should rely on large samples across longitudinal and country settings to test causality and explore financing alternatives.