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Measuring Spillover Effects from an Entrepreneurship Programme: Evidence from a Field Experiment in Tanzania

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  • Lars Ivar Oppedal Berge
  • Armando José Garcia Pires

Abstract

In this paper, we identify treatment spillovers between microfinance clients in Tanzania using data from a partial population experiment where only a subset of loan group members was offered treatment in the form of business training, a business grant, or both. Our results show large and significant spillover effects from indirect exposure to treatment through group peers. In particular, we find that male microfinance clients with peers receiving both business training and the business grant experience to have significantly higher sales than those not receiving any treatment. Moreover, microfinance clients with positive spillovers make higher investments and borrow more. In addition, the treatment impacts are higher for group members with smaller loans (which is consistent with higher marginal rates of return to capital), and for members in groups with a greater share of women. Our findings illustrate that loan groups may be an important arena for the sharing of entrepreneurial resources, and that standard treatment–control analyses of similar interventions may underestimate impacts in settings with close social interactions.

Suggested Citation

  • Lars Ivar Oppedal Berge & Armando José Garcia Pires, 2021. "Measuring Spillover Effects from an Entrepreneurship Programme: Evidence from a Field Experiment in Tanzania," Journal of Development Studies, Taylor & Francis Journals, vol. 57(10), pages 1755-1775, October.
    • Handle: RePEc:taf:jdevst:v:57:y:2021:i:10:p:1755-1775
    DOI: 10.1080/00220388.2021.1945039
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    Cited by:

    1. Renaud Bourlès & Anastasia Cozarenco & Dominique Henriet & Xavier Joutard, 2022. "Business Training with a Better-Informed Lender: Theory and Evidence from Microcredit in France," Annals of Economics and Statistics, GENES, issue 148, pages 65-108.

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