Please use this form to submit your study for inclusion into our database. It will be checked by a member of the Innovation Growth Lab team, who may be in contact to ask for more information. Your email address * Your name * Title * The name of the study Short summary A brief description of the project's goals and its current state Abstract <p>Most academic and development policy discussions about microentrepreneurs focus on credit constraints and assume that subject to those constraints, the entrepreneurs manage their business optimally. Yet the self-employed poor rarely have any formal training in business skills. A growing number of microfinance organizations are attempting to build the human capital of microentrepreneurs in order to improve the livelihood of their clients and help further their mission of poverty alleviation. Using a randomized control trial, we measure the marginal impact of adding business training to a Peruvian group lending program for female micro entrepreneurs. Treatment groups received thirty- to sixty-minute entrepreneurship training sessions during their normal weekly or monthly banking meeting over a period of one to two years. Control groups remained as they were before, meeting at the same frequency but solely for making loan and savings payments. We find little or no evidence of changes in key outcomes such as business revenue, profits, or employment. We nevertheless observed business knowledge improvements and increased client retention rates for the microfinance institution.</p> The full abstract of the study, if available Links https://doi.org/10.1162/REST_a_00074 Links to any published papers and related discussions Authors * Affiliations Academic and other institutes that the authors of the study are members of Delivery partner Organisations involved in delivering the trial, if appropriate Year Year Year199419951996199719981999200020012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023202420252026 Month MonthJanFebMarAprMayJunJulAugSepOctNovDec Day Day12345678910111213141516171819202122232425262728293031 Journal Journal publishing the study, if available Publication stage * Working Paper Published Ongoing Research Forthcoming Discussion Paper Research theme * Entrepreneurship Innovation Business Growth Country Country or countries where this study took place. Topics What sort of topics does the study cover? Sample attributes Hypotheses / research question "Are microentrepreneurs maximizing profits given a financial constraint, or can basic entrepreneurship training lead to improved managerial decisions, and thus profits?" Sample Trial population and sample selection pre-existing banking groups in the districts of Ayacucho and Lima Number of treatment groups Size of treatment groups Size of control group Unit of analysis Clustered? Yes No Cluster details Trial attributes Treatment description Entrepreneurship training as part of weekly microcredit group meeting. Existing microcredit clients of FINCA Peru were provided business training during their weekly group banking meetings. Treatment groups received entrepreneurship training sessions and materials during their weekly meetings while comparison groups remained as they were before, meeting with the same frequency to make loan and savings payments. Rounds of data collection Baseline data collection and method paper survey Data collection method and data collected Evaluation Outcome variables <p>(1) Business outcomes: measured through sales and number of workers employed<br /> (2) Business processes and knowledge: tests whether the specific practices taught in the training were adopted. Examples of such practices include paying tax, paying salary to self, using profit for business growth etc.<br /> (3) Household outcomes: household decision making and engagement of client’s own child in work.<br /> (4) Microfinance Institutional outcomes: measured by loan size, client retention, cumulative savings </p> Results <p>They find little or no evidence of changes in key outcomes such as business revenue, profits, or employment. They nevertheless observed business knowledge improvements and increased client retention rates for the microfinance institution.</p> Intervention costs Cost benefit ratio Reference Karlan, D., Valdivia, M. (2011). 'Teaching Entrepreneurship: Impact of Business Training on Microfinance Clients and Institutions'. Review of Economics and Statistics. Citation for use in academic references
