This month, we’re delighted to launch the IGL Working Paper Series. Our new series of working papers will showcase interesting trials in the fields of innovation, entrepreneurship and business growth, alongside those funded by the IGL Grants Programme, in partnership with the Ewing Marion Kauffman Foundation and the Argidius Foundation.
We’re kicking off with three excellent working papers, which all highlight different focus areas of our work, and demonstrate how experiments can generate evidence that is relevant for academics, practitioners and policy makers alike. Here’s a summary of this quarter’s papers:
While research shows a significant gender gap in traditional equity financing, emerging evidence indicates that these same gender gaps might not exist in reward-based crowdfunding, where female entrepreneurs may have an advantage. This working paper examines founder gender preferences in equity crowdfunding, and explores whether founder gender preference varies based on the gender and experience of the investor. Interestingly, the study finds that inexperienced female investors are more interested in ventures with female founders, a finding that implies that female founders are likely to increase their chances of attracting female investors on crowdfunding platforms if their email pitches include information about their gender. Encouragingly, the paper provides strong evidence that professional and experienced investors in equity-based crowdfunding tend to be “gender-blind”, offering this platform as an alternative to male-biased traditional equity contexts.
STEM subjects are generally viewed as essential for innovation-led economic growth. However, statistics suggest that the majority of STEM undergraduates do not pursue innovation-focused careers in their field of study. This trial investigates whether more STEM students can be convinced to engage in innovative tasks, either by financial incentives or by words of encouragement, and if so, whether they are capable at these tasks. The results show that it is possible to increase the proportion of students who are willing to engage in applied innovation and as a result increase total innovative output, especially when the efforts are targeted toward students with high innovative potential.
Should governments provide support programmes for small businesses for free, or should they charge for participation? This study looks at willingness to pay for business training programmes in Jamaica, and finds that charging a higher price for a course screens out a large share of entrepreneurs, including those who do not expect to benefit as much from the training. In addition, higher willingness to pay is shown to correlate with higher programme attendance. The study also provides some evidence that business training programmes encourages a higher adoption of business practices and improves business knowledge.This evidence led the team to suggest that governments should not necessarily offer support programmes for free, but rather charge an optimal price that lies between a nominal cost and market price.
New working papers will be published quarterly. Let us know if there is an excellent paper we should consider for the next release of working papers!