Original abstracts from the papers in the database are provided below. All abstracts are drawn directly from the papers referenced. Links to access the papers are provided, although
the papers may also be available from other web sources. By providing links to other sites, the United Nations Foundation and ExxonMobil Foundation do not guarantee, approve, or endorse the information or products available on these sites.
Atkinson, de Janvry, McIntosh and Sadoulet (2010)
We report on an experiment in which a new set of commercial savings products, informed by the behavioral finance literature, were offered to the microfinance borrowers of Guatemala's largest public-sector bank. We find that prompting savings at the time of loan repayment leads savings deposits to double relative to the control, and framing a contribution of 10% of the loan payment causes them to double again. Loan repayment and savings accumulation appear to be complementary. Mainstreaming the most successful product tested here would allow the bank to realize savings sufficient to leverage 50% of the short-term loan portfolio.
Intervention settings: N/A (locations unspecified).
Intervention description: New commercial savings products, with no financial incentives or penalties, were offered to existing borrowers.
Sample: 1,375 borrowers from 20 microfinance branches of Guatemala's largest public sector bank.
Findings: Prompting for savings at the time of loan payments doubles savings, while suggesting a savings deposit equal to 10% of the loan repayment causes savings to double again. Women are significantly more likely to take up the offer of a savings account. However, women's accumulated net savings are significantly lower overall.
Dupas and Robinson (2009)
Does limited access to formal savings services impede business growth in poor countries? To shed light on this question, we randomized access to non-interest-bearing bank accounts among two types of self-employed individuals in rural Kenya: market vendors (who are mostly women) and men working as bicycle-taxi drivers. Despite large withdrawal fees, a substantial share of market women used the accounts, were able to save more, and increased their productive investment and private expenditures. We see no impact for bicycle-taxi drivers. These results imply significant barriers to savings and investment for market women in our study context. Further work is needed to understand what those barriers are, and to test whether the results generalize to other types of businesses or individuals.
Intervention settings: Rural.
Intervention description: Individual commitment savings products offered by a village bank. Interest-free account; high withdrawal fees. Tested the importance of savings constraints for self-employed individuals.
Methodology: RCT - Moderate rigor (small sample size).
Sample: 185 microentpreneurs.
Findings: Positive impact of savings on business investment among women (40% increase). Increase in women's private expenditures (37 to 40% higher). Some impact on making women less vulnerable to health shocks. No effect for men.
Klinger and Schündeln (2011)
We study the effect of entrepreneurial training on enterprise outcomes, in particular whether business training for (potential) entrepreneurs of small- and medium scale enterprises can lead to an increase in the number of business start-ups or an expansion in the size of existing businesses. We study this question by analyzing the results of business training programs that an NGO held in Central America between 2002 and 2005. To deal with endogenous selection into the training program, we exploit the fact that a fixed number of applicants are taken into the training program based on a pre-training score, which creates a discontinuity around which we can compare accepted and rejected applicants and estimate the effect of training with a regression-discontinuity design. We find that receiving business training significantly increases the probability that an applicant to the workshop starts a business or expands an existing business. Thus, entrepreneurial activity such as starting and expanding businesses can be fostered by training. Exploiting the fact that in the last stage the most successful participants of the program receive substantial monetary prizes (between US$ 6,000 and 15,000) we can also provide some experimental evidence that suggests the presence of financial constraints. Finally, we investigate gender differences, and find that females experience a much larger increase in the probability of starting a business if they win the monetary prize than men, suggesting financial constraints may be significantly larger for female entrepreneurs.
Intervention settings: Not reported.
Intervention description: TechnoServe business training program implemented between 2002-2005. The program is intended for both individuals who wish to start a business, as well as for those who already have a business. Those individuals with existing businesses have about 10 employees on average. Thus, unlike some other programs, this program targets businesses of a size beyond that of household enterprises.
Methodology: Regression discontinuity design.
Sample: 655 male and female current and potential entrepreneurs who have scored into the Technoserve program based on a score of entrepreneurial ability. (Comparison group is those who did not score into the program). Current entrepreneurs have about 10 employees (not household enterprises).
Findings: Business training significantly increases the probability that an applicant to the workshop starts a business (4-9 percentage points) or expands an existing business (25 to 56 percentage points). Differential impacts of different parts of the program on the start-up of new business and the expansion of existing businesses. Results suggest financial constraints to entrepreneurs are present, and financial constraints for women are greater than for men. The effect of the full training program on business start-up or expansion is larger for male participants.
Subsidizing Vocational Training for Disadvantaged Youth in Colombia: Evidence from a Randomized TrialAttanasio et al (2011)
This paper evaluates the impact of a randomized training program for disadvantaged youth introduced in Colombia in 2005. This randomized trial offers a unique opportunity to examine the impact of training in a middle income country. We use originally collected data on individuals randomly offered and not offered training. The program raises earnings and employment for women. Women offered training earn 19.6 percent more and have a 0.068 higher probability of paid employment than those not offered training, mainly in formal-sector jobs. Cost-benefit analysis of these results suggests that the program generates much larger net gains than those found in developed countries. (JEL I28, J13, J24, O15)
Intervention settings: Rural.
Intervention description: One treatment group was offered a group lending product, while the other was offered an individual lending product. Randomization was done at the village level.
Sample: 4,353 individuals.
Findings: Significant increase in business ownership (10%), food consumption (17%) and asset ownership among those offered a group lending product.No effect among those offered an individual lending product. No significant effect on household income. No difference in repayment rates between the two treatment groups.
Challenges in Banking the Rural Poor: Evidence from Kenya's Western ProvinceDupas and Robinson (2012)
Most people in rural Africa do not have bank accounts. In this paper, we combine experimental and survey evidence from Western Kenya to document some of the supply and demand factors behind such low levels of financial inclusion. Our experiment had two parts. In the first part, we waived the fixed cost of opening a basic savings account at a local bank for a random subset of individuals who were initially unbanked. While 63% of people opened an account, only 18% actively used it. Survey evidence suggests that the main reasons people did not begin saving in their bank accounts are that: (1) they do not trust the bank, (2) service is unreliable, and (3) withdrawal fees are prohibitively expensive. In the second part of the experiment, we provided information on local credit options and lowered the eligibility requirements for an initial small loan. Within the following 6 months, only 3% of people initiated the loan application process. Survey evidence suggests that people do not borrow because they do not want to risk losing their collateral. These results suggest that, while simply expanding access to banking services (for instance by lowering account opening fees) will benefit a minority, broader success may be unobtainable unless the quality of services is simultaneously improved. There are also challenges on the demand side, however. More work needs to be done to understand what savings and credit products are best suited for the majority of rural households.
Intervention settings: Rural.
Intervention description: Provided safe place (metal box) to save money with randomly varying levels of commitment to save.
Sample: 771 Members of 113 rotating savings clubs (ROSCAs) in one administrative division of western Kenya.
Findings: Preventive health investments increased by 68%. The share of households achieving their savings goals increased by 13% (compared to 34% in the control group). Three years later 39% of those who received metal boxes were still using them for saving. Larger effects found among married than among unmarried females. The results also suggest that savings programs that do not restrict liquidity are most effective.