This study asks why more small firms in developing countries do not use the market for professional business services like accounting, marketing, and human resource specialists and asks how this could be altered.
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.
Cavendish Enterprise's Business Boost trial project involved providing young small firms - typically micro-businesses - with a treatment involving a series of workshops designed to enhance productivity. This was provided largely as a top-up to an advice and mentoring programme called 'Start and Grow'. The project was part of the government's Business Basics Programme which has the core aim of identifying cost effective, yet productivity enhancing, programmes of business support for SMEs which can be run at scale throughout the country.
This field experiment was conducted in a sales firm to test whether improving knowledge flows between coworkers affects productivity.
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.
This paper discusses implementing a lab-in-the-field experiment with 334 Turkish loan officers to test for the presence, and learn about the mechanisms, of gender discrimination in small business lending.
In this paper, a randomised experiment measures the effects of workers at an automobile manufacturing firm evaluating their managers on worker and firm outcomes.
This paper asks to what extent firms are aware of readily available information on key competitor decisions, and how this information impacts firms’ strategic choices.
This paper evaluates the effect of joint tasks on the creation of network ties with data from a novel field experiment with 112 aspiring entrepreneurs.
A randomized control trial with 945 entrepreneurs in Jamaica shows positive shortterm impacts of soft-skills training on business outcomes. The effects are concentrated among men, and disappear twelve months after the training. We argue that the main channel is increased adoption of recommended business practices, exclusively observed in the short run. We see persistent effects on an incentivized behavioral measure of perseverance after setbacks, a focus of this training.
Individual-level opportunity recognition processes are vital to corporate entrepreneurship. However, little is known regarding how managerial communication impacts the effectiveness of idea suggestion systems in stimulating individuals' participation in intrapreneurial ideation. Integrating self-determination theory, creativity, and framing research, we theorize how different ways of inviting employees to submit proposals (opt-out/opt-in registration; provision of examples) affect the number and quality of submitted ideas.
This paper studies the impact of a financial education program for top managers of medium and large enterprises in Mozambique through a randomized controlled trial (RCT). We use survey data and financial reporting data to show consistent evidence that managers adjust some financial policies in response to the education program. The largest treatment effects are on short-term financial policies related to working capital, generating a positive impact on cash flows due to reductions in account receivables and inventories.
A classical approach to collecting and elaborating information to make entrepreneurial decisions combines search heuristics such as trial and error, effectuation, and confirmatory search. This paper develops a framework for exploring the implications of a more scientific approach to entrepreneurial decision making. The panel sample of our randomized control trial includes 116 Italian startups and 16 data points over a period of about one year.
Unlike many other studies, this trial is an impact assessment of training programs that covered quality control and production management as the training topics in addition to entrepreneurship, marketing, and record keeping.
Increasing evidence indicates the importance of management in determining firms’ productivity. Yet, causal evidence regarding the effectiveness of management practices is scarce, especially for high-skilled workers in the developed world. In an eight-month field experiment measuring the productivity of captains in the commercial aviation sector, we test four distinct management practices: (i) performance monitoring; (ii) performance feedback; (iii) target setting; and (iv) pro-social incentives.
What is the effect of exposing motivated youth to firm management in practice? To answer this question, we place young professionals for one month in established firms to shadow middle managers. Using random assignment into program participation, we find positive average effects on wage employment, but no average effect on the likelihood of self-employment. Within the treatment group, we match individuals and firms in batches using a deferred-acceptance algorithm. We show how this allows us to identify heterogeneous treatment effects by firm and intern.
This paper discusses the development of a model contract to make self-liquidating, quasi-equity investments in microenterprises.
Differences in management quality are an important contributor to productivity differences across countries. A key question is then how to best improve poor management in developing countries. We test two different approaches to improving management in Colombian auto parts firms. The first uses intensive and expensive one-on-one consulting, while the second draws on agricultural extension approaches to provide consulting to small groups of firms at approximately one-third of the cost of the individual approach.
This paper studies whether small-scale businesses can learn and adopt protable practices of their successful peers. We identify such practices through a detailed business survey in urban Indonesia and disseminate the information to a randomly selected sample of small retailers through a professionally developed handbook. An orthogonal subgroup is provided additional support through business role models, and another through individualized business counseling. We find a significant increase in the adoption of profitable practices in all sub-groups of retailers.
This paper examines the impact of improvements in marketing skills relative to finance skills among small-scale entrepreneurs. It addresses three important questions: (1) What is the impact of marketing or finance skills on business profits? (2) How do improvements in marketing and finance skills respectively affect different business outcomes? (3) When are increases in marketing relative to finance skills more beneficial?
This project aims to understand how increased access to competitor information enabled by digitization affects the strategic decisions and performance of firms.
Effects of relative pay on effort and labour supply are being examined in the context of an Indian manufacturing plant where co-workers' wages are exogenously varied. Results forthcoming.
A business networking programme on firm performance in China, and how groups composition and meeting frequency can facilitate trust and information flows. Results forthcoming.
We employ a discrete choice experiment in the employment process for a national call center to estimate the willingness to pay distribution for alternative work arrangements relative to traditional office positions. Most workers are not willing to pay for scheduling flexibility, though a tail of workers with high valuations allows for sizable compensating differentials. The average worker is willing to give up 20 percent of wages to avoid a schedule set by an employer on short notice, and 8 percent for the option to work from home.
This paper explores whether the advice entrepreneurs receive about people management influences their firm's performance.
In the context of a basic, short-term data entry job, unannounced provision of public recognition to employees yielded an economically significant increase in performance. Results suggest that recognition works best when it is provided exclusively, but not too exclusively. The performance increases in exclusive recognition are mainly driven by strong positive responses of non-recipients, which is most likely due to conformity preferences.
Evaluation of a training and consulting program for managerial staff in Bangladeshi garment factories to understand how new management practices are adopted and implemented and what determines their success.
Self-control problems change the logic of agency theory by partly aligning the interests of the firm and worker: both now value contracts that elicit future effort. Findings from a year-long field experiment with full-time data entry workers support this idea. First, workers increase output by voluntarily choosing dominated contracts (which penalize low output but give no additional rewards for high output). Second, effort increases closer to (randomly assigned) paydays.
Evaluating a specific training program for youth in Uganda, recently graduated from secondary shool, aimed at identifying the differential importance of "hard" and "soft" skills. Results forthcoming.
Examines the differential impacts of group management consulting versus individualised management consulting on firm performace in Colombia, and whether management practices are partially responsible for the gap in firm productivity in developing countries. Results forthcoming.
Examines the effectiveness of a specific management production routine relying on knowledge transfer of managers in a Bangladeshi garment factory. Results forthcoming.