Demand versus Returns? Pro-Poor Targeting of Business Grants and Vocational Skills Training
Interventions aimed at increasing the income generating capacity of the poor, such as vocational training, micro-finance or business grants, are widespread in the developing world. How to target such interventions is an open question. Many programs are self-targeted, but if perceived returns differ from actual returns, those self-selecting to participate may not be those for whom the program is the most effective. The authors analyze an unusual experiment with very high take-up of business grants and vocational skills training, randomly assigned among nearly all households in selected poor rural communities in Nicaragua. On average, the interventions resulted in increased participation in non-agricultural employment and higher income from related activities. The paper investigates whether targeting could have resulted in higher returns by analyzing heterogeneity in impacts by stated baseline demand, prior participation in non-agricultural activities, and a wide range of complementary asset endowments. The results reveal little heterogeneity along observed baseline characteristics. However, the poorest households are more likely to enter and have higher profits in non-agricultural self-employment, while less poor households assigned to the training have higher non-agricultural wages. This heterogeneity appears related to unobserved characteristics that are not revealed by stated baseline demand, and more difficult to target. In this context, self-targeting may reduce the poverty-reduction potential of income generating interventions, possibly because low aspirations limit the poor's ex-ante demand for productive interventions while the interventions have the potential to increase those aspirations. Overall, targeting productive interventions to poor households would not have come at the cost of reducing their effectiveness. By contrast, self-targeting would have limited poverty reduction by excluding the poorest.
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dig-okr-10986131732024-08-08T14:42:04Z Demand versus Returns? Pro-Poor Targeting of Business Grants and Vocational Skills Training Macours, Karen Premand, Patrick Vakis, Renos ACCESS TO MARKETS ACCOUNTING AGE GROUPS AGRICULTURAL ACTIVITIES AGRICULTURAL ACTIVITY AGRICULTURAL INCOME AGRICULTURAL SELF-EMPLOYMENT ATTRITION BANKS BUSINESS PLAN BUSINESS TRAINING CHARTER SCHOOL CHARTER SCHOOLS COGNITIVE DEVELOPMENT CREDIT ACCESS DATA COLLECTION DEMAND FOR CREDIT DISPLACEMENT DIVERSIFICATION DWELLING DWELLINGS EARLY CHILDHOOD EARNINGS ECONOMIC ACTIVITIES ECONOMICS ELIGIBILITY CRITERIA ELIGIBILITY CRITERION EMPLOYMENT EXPERIENCE ENDOWMENTS ENROLLMENT ENTREPRENEURS EXCLUSION EXPENDITURE EXPENDITURES EXPERIMENTAL DESIGN FEMALE FEMALE ENTERPRISE FINANCIAL CAPITAL FINANCIAL LITERACY FINANCIAL SUPPORT FORMAL CREDIT GENDER GROSS INCOME HOUSEHOLD WELFARE HOUSEHOLDS HOUSING IMPACT EVALUATION INFORMAL CREDIT INSURANCE INTERNATIONAL BANK INTERVENTION INTERVENTIONS LABOR ECONOMICS LABOR MARKET LACK OF INFORMATION LEARNING LIVING STANDARDS LSMS MICRO-BUSINESS MICRO-FINANCE MICROCREDIT MICROFINANCE OPPORTUNITY COSTS POLITICAL ECONOMY POVERTY REDUCTION PRIMARY CAREGIVERS PRIMARY EDUCATION PRIMARY SCHOOL PRODUCTIVITY PROGRAM EFFECTIVENESS PROGRAM IMPACTS REDUCING POVERTY REGULAR ATTENDANCE RETURNS TO EDUCATION RISK MANAGEMENT RURAL AREAS RURAL COMMUNITIES SAVINGS SCHOLARSHIP SCHOOLING SELECTION BIAS SELF EMPLOYMENT SELF-EMPLOYMENT SKILLS TRAINING SMALL BUSINESS SMALL BUSINESS DEVELOPMENT SMALL BUSINESS OWNERS START-UP TARGETING TEACHERS TEACHING TECHNICAL ASSISTANCE TEMPORARY EMPLOYMENT TRAINING PROGRAMS TREATMENT GROUPS VOCATIONAL SKILLS VOCATIONAL TRAINING WAGES WOMAN YOUTH Interventions aimed at increasing the income generating capacity of the poor, such as vocational training, micro-finance or business grants, are widespread in the developing world. How to target such interventions is an open question. Many programs are self-targeted, but if perceived returns differ from actual returns, those self-selecting to participate may not be those for whom the program is the most effective. The authors analyze an unusual experiment with very high take-up of business grants and vocational skills training, randomly assigned among nearly all households in selected poor rural communities in Nicaragua. On average, the interventions resulted in increased participation in non-agricultural employment and higher income from related activities. The paper investigates whether targeting could have resulted in higher returns by analyzing heterogeneity in impacts by stated baseline demand, prior participation in non-agricultural activities, and a wide range of complementary asset endowments. The results reveal little heterogeneity along observed baseline characteristics. However, the poorest households are more likely to enter and have higher profits in non-agricultural self-employment, while less poor households assigned to the training have higher non-agricultural wages. This heterogeneity appears related to unobserved characteristics that are not revealed by stated baseline demand, and more difficult to target. In this context, self-targeting may reduce the poverty-reduction potential of income generating interventions, possibly because low aspirations limit the poor's ex-ante demand for productive interventions while the interventions have the potential to increase those aspirations. Overall, targeting productive interventions to poor households would not have come at the cost of reducing their effectiveness. By contrast, self-targeting would have limited poverty reduction by excluding the poorest. 2013-04-11T20:46:40Z 2013-04-11T20:46:40Z 2013-03 http://documents.worldbank.org/curated/en/2013/03/17483338/demand-versus-returns-pro-poor-targeting-business-grants-vocational-skills-training https://hdl.handle.net/10986/13173 English en_US Policy Research Working Paper;No. 6389 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank application/pdf text/plain World Bank, Washington, DC |
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Banco Mundial |
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Estados Unidos |
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Bibliográfico |
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biblioteca |
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America del Norte |
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Biblioteca del Banco Mundial |
| language |
English en_US |
| topic |
ACCESS TO MARKETS ACCOUNTING AGE GROUPS AGRICULTURAL ACTIVITIES AGRICULTURAL ACTIVITY AGRICULTURAL INCOME AGRICULTURAL SELF-EMPLOYMENT ATTRITION BANKS BUSINESS PLAN BUSINESS TRAINING CHARTER SCHOOL CHARTER SCHOOLS COGNITIVE DEVELOPMENT CREDIT ACCESS DATA COLLECTION DEMAND FOR CREDIT DISPLACEMENT DIVERSIFICATION DWELLING DWELLINGS EARLY CHILDHOOD EARNINGS ECONOMIC ACTIVITIES ECONOMICS ELIGIBILITY CRITERIA ELIGIBILITY CRITERION EMPLOYMENT EXPERIENCE ENDOWMENTS ENROLLMENT ENTREPRENEURS EXCLUSION EXPENDITURE EXPENDITURES EXPERIMENTAL DESIGN FEMALE FEMALE ENTERPRISE FINANCIAL CAPITAL FINANCIAL LITERACY FINANCIAL SUPPORT FORMAL CREDIT GENDER GROSS INCOME HOUSEHOLD WELFARE HOUSEHOLDS HOUSING IMPACT EVALUATION INFORMAL CREDIT INSURANCE INTERNATIONAL BANK INTERVENTION INTERVENTIONS LABOR ECONOMICS LABOR MARKET LACK OF INFORMATION LEARNING LIVING STANDARDS LSMS MICRO-BUSINESS MICRO-FINANCE MICROCREDIT MICROFINANCE OPPORTUNITY COSTS POLITICAL ECONOMY POVERTY REDUCTION PRIMARY CAREGIVERS PRIMARY EDUCATION PRIMARY SCHOOL PRODUCTIVITY PROGRAM EFFECTIVENESS PROGRAM IMPACTS REDUCING POVERTY REGULAR ATTENDANCE RETURNS TO EDUCATION RISK MANAGEMENT RURAL AREAS RURAL COMMUNITIES SAVINGS SCHOLARSHIP SCHOOLING SELECTION BIAS SELF EMPLOYMENT SELF-EMPLOYMENT SKILLS TRAINING SMALL BUSINESS SMALL BUSINESS DEVELOPMENT SMALL BUSINESS OWNERS START-UP TARGETING TEACHERS TEACHING TECHNICAL ASSISTANCE TEMPORARY EMPLOYMENT TRAINING PROGRAMS TREATMENT GROUPS VOCATIONAL SKILLS VOCATIONAL TRAINING WAGES WOMAN YOUTH ACCESS TO MARKETS ACCOUNTING AGE GROUPS AGRICULTURAL ACTIVITIES AGRICULTURAL ACTIVITY AGRICULTURAL INCOME AGRICULTURAL SELF-EMPLOYMENT ATTRITION BANKS BUSINESS PLAN BUSINESS TRAINING CHARTER SCHOOL CHARTER SCHOOLS COGNITIVE DEVELOPMENT CREDIT ACCESS DATA COLLECTION DEMAND FOR CREDIT DISPLACEMENT DIVERSIFICATION DWELLING DWELLINGS EARLY CHILDHOOD EARNINGS ECONOMIC ACTIVITIES ECONOMICS ELIGIBILITY CRITERIA ELIGIBILITY CRITERION EMPLOYMENT EXPERIENCE ENDOWMENTS ENROLLMENT ENTREPRENEURS EXCLUSION EXPENDITURE EXPENDITURES EXPERIMENTAL DESIGN FEMALE FEMALE ENTERPRISE FINANCIAL CAPITAL FINANCIAL LITERACY FINANCIAL SUPPORT FORMAL CREDIT GENDER GROSS INCOME HOUSEHOLD WELFARE HOUSEHOLDS HOUSING IMPACT EVALUATION INFORMAL CREDIT INSURANCE INTERNATIONAL BANK INTERVENTION INTERVENTIONS LABOR ECONOMICS LABOR MARKET LACK OF INFORMATION LEARNING LIVING STANDARDS LSMS MICRO-BUSINESS MICRO-FINANCE MICROCREDIT MICROFINANCE OPPORTUNITY COSTS POLITICAL ECONOMY POVERTY REDUCTION PRIMARY CAREGIVERS PRIMARY EDUCATION PRIMARY SCHOOL PRODUCTIVITY PROGRAM EFFECTIVENESS PROGRAM IMPACTS REDUCING POVERTY REGULAR ATTENDANCE RETURNS TO EDUCATION RISK MANAGEMENT RURAL AREAS RURAL COMMUNITIES SAVINGS SCHOLARSHIP SCHOOLING SELECTION BIAS SELF EMPLOYMENT SELF-EMPLOYMENT SKILLS TRAINING SMALL BUSINESS SMALL BUSINESS DEVELOPMENT SMALL BUSINESS OWNERS START-UP TARGETING TEACHERS TEACHING TECHNICAL ASSISTANCE TEMPORARY EMPLOYMENT TRAINING PROGRAMS TREATMENT GROUPS VOCATIONAL SKILLS VOCATIONAL TRAINING WAGES WOMAN YOUTH |
| spellingShingle |
ACCESS TO MARKETS ACCOUNTING AGE GROUPS AGRICULTURAL ACTIVITIES AGRICULTURAL ACTIVITY AGRICULTURAL INCOME AGRICULTURAL SELF-EMPLOYMENT ATTRITION BANKS BUSINESS PLAN BUSINESS TRAINING CHARTER SCHOOL CHARTER SCHOOLS COGNITIVE DEVELOPMENT CREDIT ACCESS DATA COLLECTION DEMAND FOR CREDIT DISPLACEMENT DIVERSIFICATION DWELLING DWELLINGS EARLY CHILDHOOD EARNINGS ECONOMIC ACTIVITIES ECONOMICS ELIGIBILITY CRITERIA ELIGIBILITY CRITERION EMPLOYMENT EXPERIENCE ENDOWMENTS ENROLLMENT ENTREPRENEURS EXCLUSION EXPENDITURE EXPENDITURES EXPERIMENTAL DESIGN FEMALE FEMALE ENTERPRISE FINANCIAL CAPITAL FINANCIAL LITERACY FINANCIAL SUPPORT FORMAL CREDIT GENDER GROSS INCOME HOUSEHOLD WELFARE HOUSEHOLDS HOUSING IMPACT EVALUATION INFORMAL CREDIT INSURANCE INTERNATIONAL BANK INTERVENTION INTERVENTIONS LABOR ECONOMICS LABOR MARKET LACK OF INFORMATION LEARNING LIVING STANDARDS LSMS MICRO-BUSINESS MICRO-FINANCE MICROCREDIT MICROFINANCE OPPORTUNITY COSTS POLITICAL ECONOMY POVERTY REDUCTION PRIMARY CAREGIVERS PRIMARY EDUCATION PRIMARY SCHOOL PRODUCTIVITY PROGRAM EFFECTIVENESS PROGRAM IMPACTS REDUCING POVERTY REGULAR ATTENDANCE RETURNS TO EDUCATION RISK MANAGEMENT RURAL AREAS RURAL COMMUNITIES SAVINGS SCHOLARSHIP SCHOOLING SELECTION BIAS SELF EMPLOYMENT SELF-EMPLOYMENT SKILLS TRAINING SMALL BUSINESS SMALL BUSINESS DEVELOPMENT SMALL BUSINESS OWNERS START-UP TARGETING TEACHERS TEACHING TECHNICAL ASSISTANCE TEMPORARY EMPLOYMENT TRAINING PROGRAMS TREATMENT GROUPS VOCATIONAL SKILLS VOCATIONAL TRAINING WAGES WOMAN YOUTH ACCESS TO MARKETS ACCOUNTING AGE GROUPS AGRICULTURAL ACTIVITIES AGRICULTURAL ACTIVITY AGRICULTURAL INCOME AGRICULTURAL SELF-EMPLOYMENT ATTRITION BANKS BUSINESS PLAN BUSINESS TRAINING CHARTER SCHOOL CHARTER SCHOOLS COGNITIVE DEVELOPMENT CREDIT ACCESS DATA COLLECTION DEMAND FOR CREDIT DISPLACEMENT DIVERSIFICATION DWELLING DWELLINGS EARLY CHILDHOOD EARNINGS ECONOMIC ACTIVITIES ECONOMICS ELIGIBILITY CRITERIA ELIGIBILITY CRITERION EMPLOYMENT EXPERIENCE ENDOWMENTS ENROLLMENT ENTREPRENEURS EXCLUSION EXPENDITURE EXPENDITURES EXPERIMENTAL DESIGN FEMALE FEMALE ENTERPRISE FINANCIAL CAPITAL FINANCIAL LITERACY FINANCIAL SUPPORT FORMAL CREDIT GENDER GROSS INCOME HOUSEHOLD WELFARE HOUSEHOLDS HOUSING IMPACT EVALUATION INFORMAL CREDIT INSURANCE INTERNATIONAL BANK INTERVENTION INTERVENTIONS LABOR ECONOMICS LABOR MARKET LACK OF INFORMATION LEARNING LIVING STANDARDS LSMS MICRO-BUSINESS MICRO-FINANCE MICROCREDIT MICROFINANCE OPPORTUNITY COSTS POLITICAL ECONOMY POVERTY REDUCTION PRIMARY CAREGIVERS PRIMARY EDUCATION PRIMARY SCHOOL PRODUCTIVITY PROGRAM EFFECTIVENESS PROGRAM IMPACTS REDUCING POVERTY REGULAR ATTENDANCE RETURNS TO EDUCATION RISK MANAGEMENT RURAL AREAS RURAL COMMUNITIES SAVINGS SCHOLARSHIP SCHOOLING SELECTION BIAS SELF EMPLOYMENT SELF-EMPLOYMENT SKILLS TRAINING SMALL BUSINESS SMALL BUSINESS DEVELOPMENT SMALL BUSINESS OWNERS START-UP TARGETING TEACHERS TEACHING TECHNICAL ASSISTANCE TEMPORARY EMPLOYMENT TRAINING PROGRAMS TREATMENT GROUPS VOCATIONAL SKILLS VOCATIONAL TRAINING WAGES WOMAN YOUTH Macours, Karen Premand, Patrick Vakis, Renos Demand versus Returns? Pro-Poor Targeting of Business Grants and Vocational Skills Training |
| description |
Interventions aimed at increasing the
income generating capacity of the poor, such as vocational
training, micro-finance or business grants, are widespread
in the developing world. How to target such interventions is
an open question. Many programs are self-targeted, but if
perceived returns differ from actual returns, those
self-selecting to participate may not be those for whom the
program is the most effective. The authors analyze an
unusual experiment with very high take-up of business grants
and vocational skills training, randomly assigned among
nearly all households in selected poor rural communities in
Nicaragua. On average, the interventions resulted in
increased participation in non-agricultural employment and
higher income from related activities. The paper
investigates whether targeting could have resulted in higher
returns by analyzing heterogeneity in impacts by stated
baseline demand, prior participation in non-agricultural
activities, and a wide range of complementary asset
endowments. The results reveal little heterogeneity along
observed baseline characteristics. However, the poorest
households are more likely to enter and have higher profits
in non-agricultural self-employment, while less poor
households assigned to the training have higher
non-agricultural wages. This heterogeneity appears related
to unobserved characteristics that are not revealed by
stated baseline demand, and more difficult to target. In
this context, self-targeting may reduce the
poverty-reduction potential of income generating
interventions, possibly because low aspirations limit the
poor's ex-ante demand for productive interventions
while the interventions have the potential to increase those
aspirations. Overall, targeting productive interventions to
poor households would not have come at the cost of reducing
their effectiveness. By contrast, self-targeting would have
limited poverty reduction by excluding the poorest. |
| topic_facet |
ACCESS TO MARKETS ACCOUNTING AGE GROUPS AGRICULTURAL ACTIVITIES AGRICULTURAL ACTIVITY AGRICULTURAL INCOME AGRICULTURAL SELF-EMPLOYMENT ATTRITION BANKS BUSINESS PLAN BUSINESS TRAINING CHARTER SCHOOL CHARTER SCHOOLS COGNITIVE DEVELOPMENT CREDIT ACCESS DATA COLLECTION DEMAND FOR CREDIT DISPLACEMENT DIVERSIFICATION DWELLING DWELLINGS EARLY CHILDHOOD EARNINGS ECONOMIC ACTIVITIES ECONOMICS ELIGIBILITY CRITERIA ELIGIBILITY CRITERION EMPLOYMENT EXPERIENCE ENDOWMENTS ENROLLMENT ENTREPRENEURS EXCLUSION EXPENDITURE EXPENDITURES EXPERIMENTAL DESIGN FEMALE FEMALE ENTERPRISE FINANCIAL CAPITAL FINANCIAL LITERACY FINANCIAL SUPPORT FORMAL CREDIT GENDER GROSS INCOME HOUSEHOLD WELFARE HOUSEHOLDS HOUSING IMPACT EVALUATION INFORMAL CREDIT INSURANCE INTERNATIONAL BANK INTERVENTION INTERVENTIONS LABOR ECONOMICS LABOR MARKET LACK OF INFORMATION LEARNING LIVING STANDARDS LSMS MICRO-BUSINESS MICRO-FINANCE MICROCREDIT MICROFINANCE OPPORTUNITY COSTS POLITICAL ECONOMY POVERTY REDUCTION PRIMARY CAREGIVERS PRIMARY EDUCATION PRIMARY SCHOOL PRODUCTIVITY PROGRAM EFFECTIVENESS PROGRAM IMPACTS REDUCING POVERTY REGULAR ATTENDANCE RETURNS TO EDUCATION RISK MANAGEMENT RURAL AREAS RURAL COMMUNITIES SAVINGS SCHOLARSHIP SCHOOLING SELECTION BIAS SELF EMPLOYMENT SELF-EMPLOYMENT SKILLS TRAINING SMALL BUSINESS SMALL BUSINESS DEVELOPMENT SMALL BUSINESS OWNERS START-UP TARGETING TEACHERS TEACHING TECHNICAL ASSISTANCE TEMPORARY EMPLOYMENT TRAINING PROGRAMS TREATMENT GROUPS VOCATIONAL SKILLS VOCATIONAL TRAINING WAGES WOMAN YOUTH |
| author |
Macours, Karen Premand, Patrick Vakis, Renos |
| author_facet |
Macours, Karen Premand, Patrick Vakis, Renos |
| author_sort |
Macours, Karen |
| title |
Demand versus Returns? Pro-Poor Targeting of Business Grants and Vocational Skills Training |
| title_short |
Demand versus Returns? Pro-Poor Targeting of Business Grants and Vocational Skills Training |
| title_full |
Demand versus Returns? Pro-Poor Targeting of Business Grants and Vocational Skills Training |
| title_fullStr |
Demand versus Returns? Pro-Poor Targeting of Business Grants and Vocational Skills Training |
| title_full_unstemmed |
Demand versus Returns? Pro-Poor Targeting of Business Grants and Vocational Skills Training |
| title_sort |
demand versus returns? pro-poor targeting of business grants and vocational skills training |
| publisher |
World Bank, Washington, DC |
| publishDate |
2013-03 |
| url |
http://documents.worldbank.org/curated/en/2013/03/17483338/demand-versus-returns-pro-poor-targeting-business-grants-vocational-skills-training https://hdl.handle.net/10986/13173 |
| work_keys_str_mv |
AT macourskaren demandversusreturnspropoortargetingofbusinessgrantsandvocationalskillstraining AT premandpatrick demandversusreturnspropoortargetingofbusinessgrantsandvocationalskillstraining AT vakisrenos demandversusreturnspropoortargetingofbusinessgrantsandvocationalskillstraining |
| _version_ |
1807160041885663232 |