The Segregation Problem
Faced with “the actual and too negative experiences of dealing with men, or more often, the perception that men would not be helpful” (McGowan and Hampton 2007: 122), female entrepreneurs in male dominated contexts may opt to carve out female-only or mostly female associations, and, certainly, there are increasing numbers of formalized female-only networks worldwide (Travers, Pemberton et al. 1997; Wood 1999). Rational individuals join networks only where the costs of membership are lower than the benefits (Welter and Trettin 2006). Sex segregated networks guarantee at least some women positions of power in the group, and it also links women to potential mentors and role models (Popielarz 1999). The homogeneity of such associations also fosters dense and emotionally close enclaves, leading to shared understandings, mutual favour exchange and reciprocation, moral support and encouraging the business owner to persevere in difficult times. In all, these groups can act as both a cheering squad and a sounding board to the nontraditional female entrepreneur. A recent comment from a member of an all-women’s business network in Northern Ireland sums this up: “It’s all women there and you know that you won’t be laughed at” (McGowan & Hampton, 2007: 122). Moreover, “the social capital that arises from this strong bond consequently enables the building of one’s
reputation because information will travel to many nodes within the network” (Suseno 2008: 154).
In spite ofthe advantages, single-sex networks are disadvantageous because they partition the available pool of human, social, cultural and financial capital. Dense associations like these offer minimal benefits where the cluster is isolated from others (i. e. clusters of men). Depending on the context, men and women hold disproportionate amounts of resources. In male-dominated fields, it is men that hold the power, status, political influence and industrial resources.4 This uneven distribution of resources means that, in male – dominated settings, men become more interesting to women, women are less useful to other women and women are unnecessary or even burdensome to men (Lipman-Blumen 1976).As Lipman-Blumen (1976: 16) explains:
“Thepragmatic recognition that males controlled economic, political, educational, occupational, legal and social resources created a situation in which men identified with and sought help from other men. Women, recognizing the existential validity of the situation, also turned to men for help and protection. By now, it is practically a psychological truism that individuals identify with other individuals whom they perceive to be the controllers of resources in any given situation”
Homophily is thought to be one of the major causes ofthe unequal distribution of social capital (Cross and Lin 2008). When high status individuals share resources amongst themselves, low status and other excluded groups are prevented from accessing the stocks of the privileged. This could be harmful to women entrepreneurs, and especially those in non-traditional industries because oftheir out-group status (Cabrera et al, 2007). Although there is little direct evidence specifically pertaining to entrepreneurs, there is much evidence to support this theory in the literature on employees. In his well-cited network analysis of employees in one newspaper publishing company, Brass
(1985) found that although women occupied more central positions in the organizational structure, they were excluded from the male dominant coalition because of their low levels of interaction with male colleagues. This negatively impacted on their levels of influence and opportunities for promotion. Cross and Lin (2008) too observed an overwhelming amount of co-ethnic homophily in social networks, and found that this was associated with significantly lower access to social capital.
Belliveau (2005) argued that educational segregation allows employers to offer women lower starting salaries because a gender wage gap is less likely to be detected where women have all-female reference groups. She compared the number and value of salary offers of 83 graduating seniors from three elite liberal arts colleges, only one of which was co-ed, and collected data on the size, heterophily of the seniors’ “job advice networks”, as well as the sex composition and reputation of the school. Interestingly, women graduating from all-female colleges, despite similar Grade Point Averages, received significantly lower salary offers, even when controlling for demographics, human capital and school reputation. Women from mixed sex schools received higher salary offers. This finding was attributed to the lower network heterophily of women’s networks, but also to network homogeneity that employers perceived women from same-sex schools would have. Put another way, employers believe that women from same sex school will consult only with other women and therefore offer them lower starting salaries. Belliveau estimated that actual and perceived network homogeneity translated into a 9 per cent wage penalty for women-only college students.
Based on these studies, it is proposed here that all-female associations are likely to be more useful to women based in traditionally female industries, than to the non-traditional female entrepreneur. Women operating in male-dominated sectors require bridges to similarly placed or more senior males if they are to attain the crucial resources of their sector. “Women in men-dominated environments might obtain a greater variety of information if they networked with some men rather than all women” (Smeltzer and Fann 1989: 26). Such a strategy is deemed vital if these firms seek growth. “A dedication to all-female networks would be a myopic strategy and one to be avoided… there is a clear need for a commitment by female entrepreneurs to building quality into their networking efforts if their enterprises are to grow, especially on a continuous, and indeed, deliberate basis” (ibid: 124). But, as discussed earlier, attempting to forge networks with men has its own pitfalls. This amounts to a kind of segregation/stereotyping bind – a damned-if-they – do-damned-if-they-don’t situation that might help to explain the relatively low numbers of women operating in male-dominated business contexts. How, then can nontraditional women overcome this bind? Recent literature suggests that computer mediated networking might provide a solution for women facing this dilemma, and these studies are discussed in the next section.