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Learning from the Experiments That Never Happened: Lessons from Trying to Conduct Randomized Evaluations of Matching Grant Programs in Africa

In: Experiments for Development: Achievements and New Directions

Listed author(s):
  • Francisco Campos
  • Aidan Coville
  • Ana M. Fernandes
  • Markus Goldstein
  • David McKenzie

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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This chapter was published in:
  • Shin-ichi Fukuda & Takeo Hoshi, 2014. "Experiments for Development: Achievements and New Directions," NBER Books, National Bureau of Economic Research, Inc, number fuku13-1.
  • This item is provided by National Bureau of Economic Research, Inc in its series NBER Chapters with number 13259.
    Handle: RePEc:nbr:nberch:13259
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    National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.

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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. Nicholas Bloom & Benn Eifert & Aprajit Mahajan & David McKenzie & John Roberts, 2013. "Does Management Matter? Evidence from India," The Quarterly Journal of Economics, Oxford University Press, vol. 128(1), pages 1-51.
    3. Marcel Fafchamps & David McKenzie & Simon Quinn & Christopher Woodruff, 2011. "When is capital enough to get female microenterprises growing? Evidence from a randomized experiment in Ghana," CSAE Working Paper Series 2011-11, Centre for the Study of African Economies, University of Oxford.
    4. Bruhn, Miriam & Karlan, Dean S. & Schoar, Antoinette S, 2012. "The Impact of Consulting Services on Small and Medium Enterprises: Evidence from a Randomized Trial in Mexico," CEPR Discussion Papers 8887, C.E.P.R. Discussion Papers.
    5. Dean Karlan, Ryan Knight, and Christopher Udry, 2012. "Hoping to Win, Expected to Lose: Theory and Lessons on Microenterprise Development," Working Papers 312, Center for Global Development.
    6. Gladys Lopez-Acevedo & Hong W. Tan, 2011. "Impact Evaluation of Small and Medium Enterprise Programs in Latin America and the Caribbean," World Bank Publications, The World Bank, number 2298, August.
    7. Ole Dahl Rasmussen & Nikolaj Malchow-Møller & Thomas Barnebeck Andersen, 2011. "Walking the talk: the need for a trial registry for development interventions," Journal of Development Effectiveness, Taylor & Francis Journals, vol. 3(4), pages 502-519, December.
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