Recent evidence has pointed to the importance of socio-emotional skills development for improving business outcomes and for helping to close the gender gap between male- and female-owned small businesses.

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Recent studies have shown that a psychology-based entrepreneurial mindset training can have promising effects on business outcomes, but there is little evidence on how to improve the financial sustainability of these programs. Researchers are evaluating the effects of an entrepreneurial mindset training paired with business training on firm outcomes for female entrepreneurs in Mexico.

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Recent studies have shown that a psychology-based entrepreneurial mindset training can have promising effects on business outcomes. In Ecuador, researchers are evaluating whether these skills can be taught at scale and online by testing the effects of an entrepreneurial mindset training program on youth education and employment outcomes. They are also investigating if and how the effects change when the program is paired with mentoring.   

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Exposure to violence, conflict, and other traumatic life events can have harmful effects on the economic, human, and social capital of individuals and their communities. Entrepreneurship and business skills training curricula have been commonly adopted as an approach for promoting socio-economic inclusion in fragile settings.

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In Sub-Saharan Africa, wage job opportunities are limited, and a vast majority of young people are engaged in low-productive work. Many governments support formal apprenticeship programs to help youth find suitable employment, but there is limited evidence on the direct and indirect effects of these public interventions.

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Youth unemployment and underemployment are pressing policy challenges in Sub-Saharan Africa and job-training programs have not proven to be effective (or cost-effective) at improving youth labor market outcomes. In Ghana, researchers conducted a randomized evaluation to estimate the impact of a government program that placed young people in traditional apprenticeships and matched them with training providers.

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Few microenterprises grow and employ more than one worker, and policymakers have struggled to identify what keeps these businesses from growing further. To study these limitations, researchers offered microentrepreneurs capital to incentivize them to hire. Results showed that a wage subsidy did not lead to lasting increases in employment sales or profits.

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While workers in larger firms tend to be more productive than those in smaller ones, the underlying reasons for these differences are unclear. In India, researchers are conducting a randomized evaluation among data entry employees, to measure the impact of different work arrangements (office- versus home-based) on worker productivity.

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Business training programs aim to instill standardized management practices in participants in hopes that these will help raise business performance. However, decision makers and researchers have struggled to find conclusive evidence on the firm-level impacts of these trainings.

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Credit: World Bank Erick Kaglan

What makes someone a successful entrepreneur? Is it a matter of teaching the right business skills, or instilling a proactive entrepreneurial mindset? If the latter, can these personal qualities be taught? This research in Togo investigated these questions, and found that a training focused on personal initiative skills, such as self-starting, future-oriented, and persistent behavior, was more successful than a traditional business training at increasing sales and profits.

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Access to quality jobs is a pressing concern in sub-Saharan Africa. Researchers have partnered with Samasource and Innovations for Poverty Action to conduct a randomized evaluation measuring the impact of a digital vocational training program, with and without an employment program, on formal employment of young Kenyans.

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Compared to their counterparts in high-income countries, small and medium enterprises (SMEs) in low-and-middle-income countries, are often less productive, grow slower, and hire fewer workers. In Mexico, Innovations for Poverty Action worked with researchers to test if this lagging productivity could owe to lower managerial capacity. They found that providing subsidized managerial consulting to Mexican SMEs boosted their productivity and hiring.

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Entrepreneurs in developing countries face a number of constraints that limit their growth and therefore their contribution to employment and long-term economic development.

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Credit: Erik Charlton / Flickr
Small and medium enterprises (SMEs) are thought to be an important source of innovation and employment. While there is a lot of research on the barriers to SME growth at the individual firm level, there is little evidence on the role of business networks in firm growth.
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When small or informal firms are invisible or inaccessible to large buyers, including governments, these firms cannot grow and reach their full potential.  Innovations for Poverty Action is working with researchers to evaluate whether a bid training provided by Building Markets that intends to teach businesses how to find, apply for, and win larger contracts can help small businesses grow.

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