The Critical Role of Implementing Partners: Evidence From Training Micro and Small Enterprises Across 12 Financial Service Providers

Despite access to financial resources, many micro and small-scale entrepreneurs struggle to grow their businesses due to management inefficiencies. This study analyses a globally recognized ILO business training initiative in Indonesia, involving 12 financial service providers in 2018. Using an RCT...

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Bibliographic Details
Published in:The Journal of development studies 2024-07, Vol.60 (7), p.1088-1113
Main Authors: Avdeenko, Alexandra, Frölich, Markus, Helmsmüller, Simona
Format: Article
Language:English
Subjects:
Efficacy
Entrepreneurs
entrepreneurship training
Financial institutions
management skills
Mate selection
micro and small enterprises
microfinance
Panel data
program evaluation
randomised control trial
Training
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Summary:Despite access to financial resources, many micro and small-scale entrepreneurs struggle to grow their businesses due to management inefficiencies. This study analyses a globally recognized ILO business training initiative in Indonesia, involving 12 financial service providers in 2018. Using an RCT and panel data from 3,975 clients to study the impacts of the business training we find largely null results across a large range of outcomes. Exploiting variation across financial institutions implementing the program, we show that one financial service provider demonstrated significant improvements in its clients' behaviours. This uneven outcome suggests that the efficacy of large-scale interventions critically depends on the quality of implementation by individual partners. The overarching conclusions advise restraint in broadly expanding these programs, while simultaneously highlighting the crucial role of partner selection in the successful implementation of these initiatives.
ISSN:0022-0388
1743-9140
DOI:10.1080/00220388.2024.2339929