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Business training and female enterprise start-up, growth, and dynamics: Experimental evidence from Sri Lanka

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  • de Mel, Suresh
  • McKenzie, David
  • Woodruff, Christopher

Abstract

We conduct a randomized experiment among women in urban Sri Lanka to measure the impact of the most commonly used business training course in developing countries, the Start-and-Improve Your Business (SIYB) program. We study two groups of women: a random sample operating subsistence enterprises and a random sample out of the labor force but interested in starting a business. We track impacts of two treatments – training only and training plus a cash grant – over two years. For women in business, training changes business practices but has no impact on business profits, sales or capital stock. The grant plus training combination increases business profitability in the first eight months, but this impact dissipates in the second year. Among potential startups, business training hastens entry – without changing longer-term ownership rates – and increases profitability. We conclude that training may be more effective for new owners.

Suggested Citation

  • de Mel, Suresh & McKenzie, David & Woodruff, Christopher, 2014. "Business training and female enterprise start-up, growth, and dynamics: Experimental evidence from Sri Lanka," Journal of Development Economics, Elsevier, vol. 106(C), pages 199-210.
  • Handle: RePEc:eee:deveco:v:106:y:2014:i:c:p:199-210 DOI: 10.1016/j.jdeveco.2013.09.005
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    References listed on IDEAS

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    1. Suresh de Mel & David McKenzie & Christopher Woodruff, 2009. "Are Women More Credit Constrained? Experimental Evidence on Gender and Microenterprise Returns," American Economic Journal: Applied Economics, American Economic Association, vol. 1(3), pages 1-32, July.
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    More about this item

    Keywords

    Business training; Female self-employment;

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training

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