Business training and female enterprise start-up, growth, and dynamics: Experimental evidence from Sri Lanka

We conduct a randomized experiment among women in urban Sri Lanka to measure the impact of the most commonly used business training course in developing countries, the Start-and-Improve Your Business (SIYB) program. We study two groups of women: a random sample operating subsistence enterprises and a random sample out of the labor force but interested in starting a business. We track impacts of two treatments - training only and training plus a cash grant - over two years. For women in business, training changes business practices but has no impact on business profits, sales or capital stock. The grant plus training combination increases business profitability in the first eight months, but this impact dissipates in the second year. Among potential startups, business training hastens entry - without changing longer-term ownership rates - and increases profitability. We conclude that training may be more effective for new owners. (C) 2013 Elsevier B.V. All rights reserved.