Prior research suggests that firms in entrepreneurial settings benefit from a scientific approach to decision making that combines cognitive and evidence-based components. But to what extent and under what conditions is the scientific approach to decision-making associated with superior performance?
IGL Trials Database
IGL curates a database with randomised controlled trials in the field of innovation, entrepreneurship and growth. Browse our list of topics, see it as a map, or use the search function below.
2024
In late 2021, Phoenix Group, a FTSE 100 financial services firm and long-term partner of MoreThanNow, asked us to evaluate the impact of an Inclusive Leadership Programme. Everyone involved in the project was aware of the limited evidence for the effectiveness of online diversity training, but the team at Phoenix Group were interested in whether bespoke, best-in-class, inclusivity training for leaders would change behaviour.
2024
The model shows that managers and entrepreneurs make better decisions under uncertainty if they adopt a scientific approach in which they formulate and test theories.
2024
Despite access to financial resources, many micro and small-scale entrepreneurs struggle to grow their businesses due to management inefficiencies. This study analyses a globally recognized ILO business training initiative in Indonesia, involving 12 financial service providers in 2018. Using an RCT and panel data from 3,975 clients to study the impacts of the business training we find largely null results across a large range of outcomes.
2023
We use a field experiment to test whether financial incentives can improve the quality of apprenticeship training. Trainers (firm owners) in the treatment group participated in a tournament incentive scheme where they received a payment based on their apprentices’ rank-order performance on a skills assessment. Trainers in the control group received a fixed payment based on their apprentices’ participation in the assessment. Performance on the assessment was higher in the treatment group.
2023
Failure is widely acknowledged as a critical component of the organizational learning and innovation processs. Learning from failure, in particular, seems extremely relevant in the context of entrepreneurship, where failure often emerges as the predominant outcome. Remarkably, most entrepreneurship training programs predominantly emphasize success stories of entrepreneurs, without leveraging the learning potential that come from stories of failure.
2023
Entrepreneurs in developing countries face a series of diverse constraints to growth, including lack of access to business skills, markets, and finance. The binding constraints vary from firm to firm, implying that the returns to possible interventions are likely to be heterogeneous.
2023
We study the allocation and productivity consequences of training production line supervisors in soft skills via a randomized controlled trial. Consistent with standard practice for training investments within firms, we asked middle managers – who sit above supervisors in the hierarchy – to nominate members of their supervisory team for training. Program access was randomized within these recommendation rankings. Highly recommended supervisors experienced no productivity gains; in contrast, less recommended supervisors’ productivity increased 12% relative to controls.
2023
Effective managers play a vital role in successful teams by creating a positive and productive team environment, assigning tasks, setting clear goals and expectations, and facilitating communication and collaboration among team members. In this paper, we employ a distinctive experimental design to identify the marginal advantage of effective managers, and the specific attributes that yield the greatest benefits to team performance.
2023
SMS-based business trainings are becoming a popular tool to remotely support microentrepreneurs in low-income settings due to their scalability and low costs. However, little evidence exists on the effectiveness of such trainings to improve business outcomes. In this study, I evaluate a field experiment in which access to an SMS-based training was randomized across 4,700 micro-entrepreneurs in Kenya. After three months, I find positive effects on knowledge and adoption of best practices.
2023
An RCT was used to investigate the effectiveness of an innovation support scheme (ISS) for SMEs in tackling age diversity challenges. The ISS included leadership training aimed at fostering team climate and valuing age diversity, and computer-based cognitive training for employees. Levels of recruitment into the trial, engagement in the interventions and response rates to surveys were lower than anticipated, which have all limited the potential to identify the impacts of the interventions.
2023
In an RCT with US small businesses, we document that a large share of firms are not well-informed about bankruptcy. Many assume that bankruptcy necessarily entails the death of a business and do not know about Chapter 11 bankruptcy, where debts are renegotiated so that the business can continue operating. Small businesses are also unaware of a recent major reform that lowered the costs of bankruptcy procedures to enhance their protection.
2023
As more and more activities in the economy become digitized, analytics and data-driven decision-making (DDD) are becoming increasingly important. The adoption of analytics and DDD has been slower in small-to-medium enterprises (SMEs) compared to large firms, and reliable causal estimates of the impacts of analytics tools for small businesses have been lacking. We derive experiment-based estimates of the effect of an analytics tool on SME outcomes, analyzing the randomized introduction of eBay’s Seller Hub (SH), a data-rich seller dashboard.
2023
We evaluate the impact of a training program aimed at improving the relational atmosphere in the workplace. The program encourages prosocial behavior and the use of professional language, focusing primarily on leaders’ behavior and leader-subordinate interactions. We implement this program using a clustered randomized design involving over 3,000 headquarters employees of 20 large corporations in Turkey. We evaluate the program with respect to employee separation, pro- and antisocial behavior, the prevalence of support networks, and perceived workplace climate.
2023
Purpose
This article reports the results of a randomized field experiment that tested the effects of a new business intervention among managers of small- and medium-sized enterprises (SMEs) in England.
Design/methodology/approach
Individual managers (learners) were randomly assigned in clusters (companies) to either an intervention group (265 learners; 40 SMEs) receiving a novel virtual, blended training program designed to stimulate a change in management behavior or a no-intervention group (118 learners; 22 SMEs).
2023
Entrepreneurs persist in business despite low returns. Following the Dunning-Kruger effect and threshold model of exit, we argue that entrepreneurs display general overconfidence in evaluating their relative ability and benchmarking information thus induce exit. To investigate, we administered a randomized controlled trial of benchmarking among 194 Singapore food-stall owners. Both control and treatment owners were informed of their own performance. Additionally, treatment owners were informed of their relative performance and best practices.
2023
Does growth training help entrepreneurs scale-up new ventures? Our field experiment answers this question using data from 181 Singapore-based, early-growth entrepreneurs drawn from a broad range of industry sectors. Treatment content focused on three growth-catalyst tools relevant for formulating and executing innovation-led growth: business-model design, leveraging external networks, building internal teams. Treatment format comprised interactive lecture sessions and workshops on these tools supplemented by personalized coaching in applying the tools to entrepreneurs’ specific challenges.
2023
Although entrepreneurship training programs are designed to help necessity entrepreneurs acquire skills and capabilities to take entrepreneurial action, participants in these programs often fail to do so. In partnership with a local government agency, we conducted a randomized field experiment involving 165 entrepreneurs in rural Tanzania where in addition to providing technical-skills training, approximately half of the participants also received “growth mindset” psychological training.
2023
Agricultural extension programs often train a few farmers and count on diffusion through social networks for the innovation to spread. However, if markets are imperfectly integrated, this may also inflict negative externalities. In a two-step experiment of an agronomy training program among Rwandan coffee farmers, we first randomize the concentration of trainees at the village level and then randomly select within each village. Knowledge increased, and yields were 6.7% higher for trained farmers.
2022
We analyze, benchmark, and run randomized controlled trials on a panel of 7,463 U.S. entrepreneurs making incentivized sales forecasts. We assess accuracy using a novel administrative dataset obtained in collaboration with a leading US payment processing firm. At baseline, only 13% of entrepreneurs can forecast their firm’s sales in the next three months within 10% of the realized value, with 7.3% of the mean squared error attributable to bias and the remaining 92.7% attributable to noise.
2022
This project is a collaboration with Corner to Corner to study the impact of their entrepreneurship training course on financial stability. Corner to Corner, a Nashville-based nonprofit, is focused on their mission of helping their neighbors to flourish and addressing the racial wealth gap. One of their primary programs is The Academy, a 10-week entrepreneurship training course that teaches students the fundamentals of starting and operating their own business.
2022
This paper tests whether providing more information on business practices can lead firms to seek out advice and improve their practices. The authors collaborated with a business advice provider in Brazil to implement a randomized experiment with 866 small firms. The treatment groups received different versions of an information sheet that benchmarked business practices to other firms and listed five practices to improve.
2022
The study investigates the role of information constraints and behavioral biases in the under-adoption of key business practices by micro-enterprises in Brazil. We combine a randomized control trial with online surveys to study these questions.
2022
This impact evaluation aims to measure the effect of a program that combines business training, mentoring, and a large cash transfer on high-potential small and medium businesses in Chile. 250 out of the top 500 firms participating in a business plan competition will be randomly selected to receive all three components of the program, while the remaining firms will receive none of them. In-person surveys with the entrepreneurs will be conducted before and 12 months after the program.
2022
This impact evaluation aims to measure the effect of a program that combines business training, mentoring, and a large cash transfer on high-potential small and medium businesses in Chile. 250 out of the top 500 firms participating in a business plan competition will be randomly selected to receive all three components of the program, while the remaining firms will receive none of them.
2022
The limited market size of many small emerging economies is a key constraint to the growth of innovative small and medium enterprises. Exporting offers a potential solution, but firms may struggle to locate and appeal to foreign buyers. A six-country randomized experiment was conducted with 225 firms in the Western Balkans to test the effectiveness of 30 hours of live group-based training and 5 hours of one-on-one remote consulting in overcoming these constraints.
2022
What is preventing entrepreneurs and managers from forming peer connections themselves? This paper argues that entrepreneurs may be under-networked because they lack the necessary social skills that allow them to match efficiently with knowledgeable peers.
2022
. A randomized experiment is conducted a in Nigeria to test the relative effectiveness of these different approaches in improving business practices.
2022
We study direct productivity changes and spillovers after a randomized training program for the frontline workers in a Colombian government agency. While trained workers improved their individual production, we also find substantial spillovers that affected managers' productivity. We use email data and a survey to explore the mechanisms behind these spillovers and find that managers' increased output arises from reductions in the need to help lower level employees.
2021
This experiment tests the impact of a program with the main goal of helping firms to attract new customers, expand markets, adapt their business model, and bounce back from the COVID-19 pandemic by boosting demand for their products.