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The Effects of Micro-entrepreneurship Programs on Labor Market Performance: Experimental Evidence from Chile

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  • Claudia Martínez A.
  • Esteban Puentes
  • Jaime Ruiz-Tagle

Abstract

We investigate the impact of a program providing asset transfers and business training to low income individuals in Chile, and asked whether a larger asset transfer would magnify the program's impact. We randomly assigned participation in a large scale, publicly run micro-entrepreneurship program and evaluated its effects over 45 months. The program improved business practices, employment, and labor income. In the short run, self-employment increased by 14.8/25.2 percentage points for a small/large asset transfer. In the long run, individuals assigned to a smaller transfer were 9 percentage points more likely to become wage workers, whereas those assigned to larger transfers tended to remain self-employed.

Suggested Citation

  • Claudia Martínez A. & Esteban Puentes & Jaime Ruiz-Tagle, 2018. "The Effects of Micro-entrepreneurship Programs on Labor Market Performance: Experimental Evidence from Chile," American Economic Journal: Applied Economics, American Economic Association, vol. 10(2), pages 101-124, April.
    • Handle: RePEc:aea:aejapp:v:10:y:2018:i:2:p:101-24
    Note: DOI: 10.1257/app.20150245
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    Citations

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    Cited by:

    1. Escudero, Verónica & López Mourelo, Elva & Pignatti, Clemente, 2020. "Joint provision of income and employment support: Evidence from a crisis response in Uruguay," World Development, Elsevier, vol. 134(C).
    2. Antonia Asenjo & Verónica Escudero & Hannah Liepmann, 2024. "Why Should we Integrate Income and Employment Support? A Conceptual and Empirical Investigation," Journal of Development Studies, Taylor & Francis Journals, vol. 60(1), pages 1-29, January.
    3. Nurul Mohammad Zayed & Friday Ogbu Edeh & Khan Mohammad Anwarul Islam & Vitalii Nitsenko & Olena Polova & Olha Khaietska, 2022. "Utilization of Knowledge Management as Business Resilience Strategy for Microentrepreneurs in Post-COVID-19 Economy," Sustainability, MDPI, vol. 14(23), pages 1-16, November.
    4. Padilla-Angulo, Laura & Lasarte-López, Jesús Miguel & Pozo, Pedro Caldentey Del, 2023. "Policy evaluations of microenterprise business support services in Latin America: A systematic review," Evaluation and Program Planning, Elsevier, vol. 97(C).
    5. Lafortune, Jeanne & Pugatch, Todd & Tessada, José & Ubfal, Diego, 2022. "Can Interactive Online Training Make High School Students More Entrepreneurial? Experimental Evidence from Rwanda," IZA Discussion Papers 15064, Institute of Labor Economics (IZA).
    6. Busso, Matías & Park, Kyunglin & Irazoque, Nicolás, 2023. "The Effectiveness of Management Training Programs: A Meta-Analytic Review," IDB Publications (Working Papers) 12782, Inter-American Development Bank.
    7. Edmonds, Eric & Theoharides, Caroline, 2020. "The short term impact of a productive asset transfer in families with child labor: Experimental evidence from the Philippines," Journal of Development Economics, Elsevier, vol. 146(C).
    8. Monserrat Serio & Pablo Mahnic, 2022. "Exploring the U-shaped relationship between education and entrepreneurial choice: a theoretical model and empirical findings for Latin America," SN Business & Economics, Springer, vol. 2(6), pages 1-22, June.

    More about this item

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • L53 - Industrial Organization - - Regulation and Industrial Policy - - - Enterprise Policy
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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    1. The Effects of Micro-entrepreneurship Programs on Labor Market Performance: Experimental Evidence from Chile (American Economic Journal: Applied Economics 2018) in ReplicationWiki

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