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Learning from the experiments that never happened : lessons from trying to conduct randomized evaluations of matching grant programs in Africa

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Author Info

  • Campos, Francisco
  • Coville, Aidan
  • Fernandes, Ana M.
  • Goldstein, Markus
  • McKenzie, David

Abstract

Matching grants are one of the most common policy instruments used by developing country governments to try to foster technological upgrading, innovation, exports, use of business development services and other activities leading to firm growth. However, since they involve subsidizing firms, the risk is that they could crowd out private investment, subsidizing activities that firms were planning to undertake anyway, or lead to pure private gains, rather than generating the public gains that justify government intervention. As a result, rigorous evaluation of the effects of such programs is important. The authors attempted to implement randomized experiments to evaluate the impact of seven matching grant programs offered in six African countries, but in each case were unable to complete an experimental evaluation. One critique of randomized experiments is publication bias, whereby only those experiments with"interesting"results get published. The hope is to mitigate this bias by learning from the experiments that never happened. This paper describes the three main proximate reasons for lack of implementation: continued project delays, politicians not willing to allow random assignment, and low program take-up; and then delves into the underlying causes of these occurring. Political economy, overly stringent eligibility criteria that do not take account of where value-added may be highest, a lack of attention to detail in"last mile"issues, incentives facing project implementation staff, and the way impact evaluations are funded, and all help explain the failure of randomization. Lessons are drawn from these experiences for both the implementation and the possible evaluation of future projects.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6296.

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Date of creation: 01 Dec 2012
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Handle: RePEc:wbk:wbrwps:6296

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Related research

Keywords: Microfinance; Banks&Banking Reform; Access to Finance; ICT Policy and Strategies; E-Business;

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References

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  1. David McKenzie, 2010. "Impact Assessments in Finance and Private Sector Development: What Have We Learned and What Should We Learn?," World Bank Research Observer, World Bank Group, vol. 25(2), pages 209-233, August.
  2. Dean Karlan & Ryan Knight & Christopher Udry, 2012. "Hoping to Win, Expected to Lose: Theory and Lessons on Micro Enterprise Development," Working Papers 1014, Economic Growth Center, Yale University.
  3. Fafchamps, Marcel & McKenzie, David J. & Quinn, Simon & Woodruff, Christopher, 2011. "When is capital enough to get female microenterprises growing? Evidence from a randomized experiment in Ghana," CEPR Discussion Papers 8466, C.E.P.R. Discussion Papers.
  4. Bloom, Nicholas & Eifert, Benn & Mahajan, Aprajit & McKenzie, David & Roberts, John, 2010. "Does Management Matter?: Evidence from India," Research Papers 2074, Stanford University, Graduate School of Business.
  5. Mariam Bruhn & Dean Karlan & Antoinette Schoar, 2012. "The Impact of Consulting Services on Small and Medium Enterprises: Evidence from a Randomized Trial in Mexico," Working Papers 1010, Economic Growth Center, Yale University.
  6. Ole Dahl Rasmussen & Nikolaj Malchow-M�ller & Thomas Barnebeck Andersen, 2011. "Walking the talk: the need for a trial registry for development interventions," The Journal of Development Effectiveness, Taylor and Francis Journals, vol. 3(4), pages 502-519, December.
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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Learning from the experiments that didn’t happen: Part I
    by David McKenzie in Development Impact on 2013-01-07 12:43:21
  2. Learning from the experiments that didn't happen: Part II
    by Markus Goldstein in Development Impact on 2013-01-09 15:09:03
  3. Leaning against publication bias: about the experiments that do not work out
    by Economic Logician in Economic Logic on 2013-01-29 15:44:00
  4. Development that Works: 4 views on evaluation challenges
    by Guest blogger in Eval Central on 2013-05-14 16:39:55

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