Standard business training programs aim to boost the incomes of the millions of self-employed business owners in developing countries by teaching basic financial and marketing practices, yet the impacts of such programs are mixed. We tested whether a psychology-based personal initiative training approach, which teaches a proactive mindset and focuses on entrepreneurial behaviors, could have more success. A randomized controlled trial in Togo assigned microenterprise owners to a control group (n = 500), a leading business training program (n = 500), or a personal initiative training program (n = 500). Four follow-up surveys tracked outcomes for firms over 2 years and showed that personal initiative training increased firm profits by 30%, compared with a statistically insignificant 11% for traditional training. The training is cost-effective, paying for itself within 1 year.
|Title||Teaching personal initiative beats traditional training in boosting small business in West Africa|
|Published in||Science, 357(6357), 1287-1290|
|Thematic Area||Gender and Employment|
|Project||Addressing Gender Inequalities in Earnings and Productivity in Sub-Saharan Africa through Innovative Approaches|