Financial Capability Financial Inclusion Working Paper

Fostering Entrepreneurship among Low-Income Individuals through Financial Capability

By creating employment opportunities, producing wealth, advancing technology, and driving economic growth, entrepreneurship constitutes an important part of the U.S. economy. Entrepreneurship brings great pecuniary and nonpecuniary benefits for individuals. For many poor individuals, entrepreneurship is appealing because it provides an avenue towards economic self-sufficiency and the American Dream. This project aims to understand entrepreneurship, theoretically and empirically, with a focus on low-income individuals. We attempt to answer the question of how to foster entrepreneurship among low-income individuals with a focus on financial capability. We provide a review of entrepreneurship theories followed by an examination of determinants of entrepreneurship and barriers to entrepreneurship. Using the financial capability approach, we provide an assessment of low-income entrepreneurs’ financial capability. Finally, we evaluate policies and programs to promote financial capability of low-income entrepreneurs, and also suggest aims and the road map.

Support for this publication comes from the Kauffman Foundation (Grant No. 201806-4478).

Project: Financial Capability & Asset Building (FCAB)


Huang, J., & Guo, B. (2021). Fostering entrepreneurship among low-income individuals through financial capability (CSD Working Paper No. 21-08, submitted for publication). Washington University, Center for Social Development.