Traders beyond borders: Incentives to trade and microenterprise performance

Paolo Falco, Mattea Stein and Eleanor Wiseman

No wp-2026-72, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: We experimentally investigate the impact of an incentive for cross-border trade on microenterprise performance at the Kenya-Uganda border. Through a randomized controlled trial, we assess the effects of a scalable monetary incentive combined with an information treatment. The monetary incentive has strong positive effects on trade volume, revenue, profit, and savings, which persist beyond the incentive period. We explore the underlying mechanisms driving these results, particularly the role of profit reinvestment, and changes in trading practices.

Keywords: Trade; Microenterprises; Subsidies; Randomized controlled trial; Investment incentives; Kenya; Uganda (search for similar items in EconPapers)
Date: 2026
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