Teaching entrepreneurship: Impact of business training on microfinance clients and institutions

Dean Karlan and Martín Valdivia

Natural Field Experiments from The Field Experiments Website

Abstract: 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 microentrepreneurs. 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.

Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (31)

Downloads: (external link)
http://s3.amazonaws.com/fieldexperiments-papers2/papers/00282.pdf

Related works:
Journal Article: Teaching Entrepreneurship: Impact of Business Training on Microfinance Clients and Institutions (2011)
Working Paper: Teaching Entrepreneurship: Impact of Business Training on Microfinance Clients and Institutions (2007)
Working Paper: Teaching Entrepreneurship: Impact of Business Training on Microfinance Clients and Institutions (2006)
Working Paper: Teaching Entrepreneurship: Impact of Business Training on Microfinance Clients and Institutions (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:feb:natura:00282

Access Statistics for this paper

More papers in Natural Field Experiments from The Field Experiments Website
Bibliographic data for series maintained by Francesca Pagnotta ().