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The Effect of Personalized Feedback on Small Enterprises’ Finances in Uganda

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  • Antonia Grohmann
  • Lukas Menkhoff
  • Helke Seitz

Abstract

This randomized controlled trial examines the effect of a new finance training style during which participants are given personalized feedback on their financial business outcomes in addition to a rule-of-thumb training approach. We compare this with the effects of a rule-of-thumb training by itself and a control group. Targeting about 500 small entrepreneurs in Uganda, we find that the personalized feedback training significantly improves outcomes at the 6-month horizon. The index of primary outcomes increases by 0.258 SD units, and overall savings improve by 0.257 SD units. Survey results suggest that feedback partly works by increasing motivation, in line with feedback intervention theory.

Suggested Citation

  • Antonia Grohmann & Lukas Menkhoff & Helke Seitz, 2022. "The Effect of Personalized Feedback on Small Enterprises’ Finances in Uganda," Economic Development and Cultural Change, University of Chicago Press, vol. 70(3), pages 1197-1227.
    • Handle: RePEc:ucp:ecdecc:doi:10.1086/713928
    DOI: 10.1086/713928
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    Cited by:

    1. Schoofs, Annekathrin, 2022. "Promoting financial inclusion for savings groups: A financial education programme in rural Rwanda," Journal of Behavioral and Experimental Finance, Elsevier, vol. 34(C).
    2. Antonia Grohmann & Tabea Lakemann & Helke Seitz, 2020. "Savings Goal Calendars as Soft Commitment Devices: Evidence from Small Business Owners in Uganda," Discussion Papers of DIW Berlin 1919, DIW Berlin, German Institute for Economic Research.

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    More about this item

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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