Micro-entrepreneurship and household economic well-being: the moderating role of women’s economic agency

  • Toto Sukarnoto 
    Universitas Islam Bunga Bangsa Cirebon
    Indonesia

Abstract

Household economic well-being in low-income families depends heavily on women-run micro-enterprises, yet it remains unclear whether the returns to micro-entrepreneurship are conditioned by women's economic agency. Drawing on Schumpeterian entrepreneurship theory and Kabeer's resources–agency–achievements framework, this study examines whether women's economic agency—operationalized as access to, participation in, control over, and benefit from economic resources—moderates the effect of micro-entrepreneurship (entrepreneurial orientation: innovativeness, achievement orientation, risk-taking, leadership, autonomy, and resilience) on family economic strengthening, measured as household economic well-being (income, household composition, education, health, and housing). Survey data were collected from 400 women micro-entrepreneurs who are clients of a group-based Sharia microfinance programme, selected by proportional stratified random sampling from a population of 499,906 clients; the sample size was set with the Slovin formula (e = 5%) and confirmed by an a priori power analysis (f² = 0.02, α = 0.05, power = 0.80, minimum n = 395). All scales showed acceptable reliability (Cronbach's α = 0.743–0.780). Simple and moderated regression analyses show that micro-entrepreneurship positively affects household economic well-being (β = 0.344, t = 7.309, p < 0.001, R² = 0.118). Adding women's economic agency and the interaction term raises the explained variance to R² = 0.444 (F = 105.493, p < 0.001). Women's economic agency has a strong direct effect (B = 1.006, p < 0.001) and a negative interaction with micro-entrepreneurship (B = −0.015), indicating a quasi-moderating, substitutive mechanism: the marginal return to micro-entrepreneurship is largest among women with lower agency and declines as their control over resources increases. The study contributes by specifying how women's agency conditions the entrepreneurship–household well-being pathway in an Islamic microfinance context and suggests that microfinance providers should combine business support with interventions that expand women's control over resources.

Keywords
  • Family economy
  • Micro entrepreneurship
  • Women's empowerment
  • Household economic well-being
  • Moderated regression analysis
  • Sharia microfinance
Lisensing Information
Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite
Sukarnoto, T. (2026). Micro-entrepreneurship and household economic well-being: the moderating role of women’s economic agency . Lentera Negeri, 7(1), 2240–2253. https://doi.org/10.29210/994450
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