Is it who you are or what you get? Comparing the impacts of loans and grants for microenterprise development
By: Crépon, Bruno Komi, Mohamed El and Osman, Adam
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Material type: 
BookPublisher: American Economic Journal: Applied Economics Description: 16(1), Jan, 2024: p.286-313.Subject(s): Financial support Business loans Cash grants In-kind grants Optimal investments Moral hazard Microenterprise development Income increase Owner heterogeneity Treatment groups Randomized control trial (RCT) Business support effectiveness Small business success Financial interventions Economic impact
In:
American Economic Journal: Applied EconomicsSummary: Is the type of financial support provided to businesses more important than which businesses receive it? Loans and grants can lead to differences in optimal investments and in scope for moral hazard. We randomize 3,293 business loan applicants into receiving a loan, cash grant, in-kind grant, or nothing. All treatments equally increase income, yet there are large differences within a treatment group with impacts concentrated at the top of the distribution. Those who succeed with loans are observationally equivalent to those who succeed with grants, showcasing that owner heterogeneity is more important than the type of support received in microenterprise development.- Reproduced
https://www.aeaweb.org/articles?id=10.1257/app.20210683
| Item type | Current location | Call number | Vol info | Status | Date due | Barcode |
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Articles
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Indian Institute of Public Administration | 16(1), Jan, 2024: p.286-313 | Available | AR131337 |
Is the type of financial support provided to businesses more important than which businesses receive it? Loans and grants can lead to differences in optimal investments and in scope for moral hazard. We randomize 3,293 business loan applicants into receiving a loan, cash grant, in-kind grant, or nothing. All treatments equally increase income, yet there are large differences within a treatment group with impacts concentrated at the top of the distribution. Those who succeed with loans are observationally equivalent to those who succeed with grants, showcasing that owner heterogeneity is more important than the type of support received in microenterprise development.- Reproduced
https://www.aeaweb.org/articles?id=10.1257/app.20210683
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