Evidence on entrepreneurship & microfinance


Entrepreneurs are important income providers and job creators. They benefit both booming and slow job growth economies through innovation and by stimulating competition. The promotion of youth entrepreneurship seeks to enhance skills among youth and foster an appropriate business climate where youth can unleash their entrepreneurial potential and young entrepreneurs can grow their businesses, creating decent jobs for themselves and others.

Governments and development actors are increasingly promoting self-employment and entrepreneurship as a strategy for providing economic opportunities for young people. Interventions include a mix of training, microfinance, mentoring and business services. But do these programmes work? And if so, under what conditions?



Edited Wed, Nov 29, 2017 7:26 PM

Replies to this Topic

Latest Evidence from Randomized Evaluations of Microfinance from JPAL

Authors: Jonathan Bauchet, Cristobal Marshall, Laura Starita, Jeanette Thomas, and Anna Yalouris

Perhaps one of the greatest contributions from these first randomized evaluations of microcredit will be to help reset expectations. Far from offering the last word on the impact of microfinance, the existing evidence instead offers a foundation for learning what works, for whom, and under what circumstances so that products and delivery approaches can be better used and adjusted to meet the needs of poor people.

This paper summarizes the latest research findings from a new body of empirical evidence that uses randomized evaluations, similar to those used in medical trials, to compare how one group responds to access to specific new financial services against how a comparable group fares without those services. This paper goes back a couple of years to the first studies that used this approach, and summarizes a series of research studies presented at the October 2010 Microfinance Impact and Innovation Conference in New York. These studies evaluated product design for a range of financial services, including credit, savings, and insurance. The studies discussed here were undertaken by research affiliates of Innovations for Poverty Action (IPA), the Financial Access Initiative (FAI), and the Abdul Latif Jameel Poverty Action Lab (J-PAL) at the Massachusetts Institute of Technology; they are all randomized evaluations unless otherwise specified.

Part 1 of this paper reviews the main results from randomized evaluations that measure the impact of microcredit and microsavings on business investment and creation, consumption, and household well-being. Part 2 presents evidence from evaluations of products and delivery design. Part 3 discusses the evidence on microinsurance product.

Latest findings randomized evaluations microfinance



Edited Tue, Jun 24, 2014 11:18 AM

Stimulating Microenterprise Growth: Results from a Loans, Grants and Training Experiment in Uganda

Author: Nathan Fiala

Results of a randomized experiment with microenterprise owners in Uganda are presented exploring constraints to capital, skills and self-control. Business owners were randomly selected to receive loans, cash grants, business skills training, or a combination of these programs. Loans and grants were distributed by Pride Finance. Business skills training was delivered using the International Labour Organization's "Improve Your Business" curriculum.

It was found that men with access to loans and training report significantly higher profits. The loan-only intervention had some initial impact, but this does not last. There are no impacts from the grant intervention, and no effects for women from any of the interventions. The results suggest that male-owned microenterprises can grow through finance when paired with training.

Research paper:

Stimulating Microenterprise Growth


WED: Measuring Change in Women Entrepreneur's Economic Empowerment: A Literature Review (working paper)

Author: Diana Wu, Donor Committee for Enterprise Development

This paper is aimed to support DCED member projects to integrate gender considerations more fully into private sector development (PSD) measurement systems. It takes a first step at bridging the knowledge gap by:

1. Reviewing definitions of women's economic empowerment
Based on a literature review, this report proposes a set of four domains to represent economic empowerment: (1) Agency (2) Institutional environment, norms, recognition and status (3) Social relations, account-ability, networks, influence (4) Economic advancement

2. Identifying current measures for women's economic empowerment in WED
This review used the economic empowerment framework to map WED DCED project measures of change at the household level. Across the 30 project documents reviewed, nearly 2/3 did not have any indicators at the household level. For those that did, 75% did not appear to disaggregate household level change by sex to understand how different members of a household have experienced change.

3. Offering practical ways forward for measuring household level change in women's economic empowerment
Part III highlights a set of practical approaches and resources toward identifying measures and methods for results measurement in women's economic empowerment. Foundational to this process is taking an approach that constructs pathways toward women's economic empowerment. This process aligns with and complements DCED Guidance on implementing results chains.


Policy responses to the gender gap in entrepreneurship

A post by David Halabisky (OECD) for the World Economic Forum discusses reasons for the large gender gap in entrepreneurship around the world and formulates five concrete recommendations for policy makers to close this gap:


Edited Mon, Nov 13, 2017 9:44 AM

Egypt Entrepreneurship Summit 2017

ILO-IFAD Taqeem Policy Roundtable: What works in promoting entrepreneurship for rural women?

As part of the Egypt Entrepreneurship Summit 2017, ILO-IFAD Taqeem hosted a policy roundtable titled "What works in promoting entrepreneurship for rural women?". The roundtable presented evidence on rural women's entrepreneurship promotion programmes and related policy measures in the MENA region.

News | Hurghada Governorate, Red Sea, Egypt | 17 November 2017



The Ministry of Investment and International Cooperation and the International Labour Organization in partnership with the Middle East Council for Small Business and Entrepreneurship held the 3rd Annual Egypt Entrepreneurship Summit in Hurghada, Egypt from 16-18 November 2017. This summit brought together practitioners, educators and policy makers to explore concepts and guiding principles that support the entrepreneurial ecosystem in Egypt. The conference sessions discussed key themes related to the future of self-employment and entrepreneurship including rural entrepreneurship, the gender gap, the evidence base for "what works" as well as training and education policy.

The purpose of the gathering was to advance knowledge and ideas to support small business formation and growth. The summit, and the session of ILO-IFAD Taqeem in particular, contributed to the knowledge base on how entrepreneurship among women can be increased - responding to the large gender gap in labour force participation between women and men in Egypt and the particular challenge for rural areas where formal public and private employment opportunities for women are scarce. To date self-employment rates among women - and especially young women - in rural Egypt are low. However, promoting entrepreneurship among rural women has the potential to socially and economically empower a large yet underprivileged section of Egypt's population.

Policy roundtable: "What works in promoting entrepreneurship for rural women?"

Keynote speech: Dr Michael Grimm, University of Passau

As part of the Egypt Entrepreneurship Summit 2017, ILO-IFAD Taqeem hosted a policy roundtable titled "What works in promoting entrepreneurship for rural women?". The roundtable presented evidence on rural women's entrepreneurship promotion programmes and related policy measures in the MENA region. Senior representatives of the Taqeem Community of Practice discussed examples on how gender mainstreaming and improved results measurement is helping to close the evidence gap for effective active labour market policies and programmes. 

The Taqeem Community of Practice is supported through a partnership between the ILO and the International Fund for Agricultural Development (IFAD) as part of the IFAD-financed project "Strengthening gender monitoring and evaluation in rural employment in the Near East and North Africa." Through rigorous impact research, this capacity development and learning grant project aims to understand "what works" in the promotion of gender mainstreaming, with the ultimate goal of reaching gender equality in rural employment outcomes across the region. Three members of the Community of Practice namely RISE Egypt, the Alexandria Business Association, and the Population Council took part in this policy roundtable as panellists. 

In his keynote speech Professor Michael Grimm (University of Passau, Germany) presented five lessons to be learned from the global evidence base on what works in promoting entrepreneurship for rural women:

  1. Empowering rural women needed culturally and gender-sensitive interventions, for example involving local communities, working with female role models but also ensuring adequate access to training sites for women and target sectors such as agribusiness.
  2. With regard to microfinance, the evidence suggests that effects of microloans on employment creation are small- in particular for female-led businesses. According to Prof Grimm this was in part because micro-loans were often too small (leading to smoothed consumption rather than investments in businesses) and not well-enough targeted to rural women who have the largest potential for becoming successful entrepreneurs.
  3. As formal education for rural women has improved dramatically over the past decades, entrepreneurship programmes should focus on linking rural women to the labour market through specific knowledge and on-the-job training, such as development of business plans and mentoring schemes during implementation.
  4. Business development services show promising results in several studies but that targeting of rural areas needs to be improved while ensuring that services are offered based on local and women relevant demands.
  5. Stress the importance of embedding entrepreneurship promotion programmes in sectoral growth strategies, for example for rural women in post-harvesting and processing industries that are targeted at export markets.
Panellists (left to right): Dr Michael Grimm (University of Passau), Ibrahim Melouk (ABA), Perihan Tawfik (ILO, moderator), Rana Elmeligy (ILO), Eman El-Hadary (RISE Egypt), Dr Ali Rashed (Population Council)

During the following panel discussion, Ms Elmeligy presented results from a Taqeem supported randomized controlled trial which measures outcomes of women's attitudes towards self-employment in Egypt. The study showed that discriminatory beliefs and strong gender differentiation in perceptions of women entrepreneurship are common among young people in Egypt. For example, over 80 per cent of women in the study believed that in Egypt it is possible for women to successfully run a business while only 50 per cent of men agreed. The evaluation then assessed the impacts of the popular television series "El Mashroua" ("the project" in English"), a reality TV show where 14 young entrepreneurs are tested on their business knowledge and acumen. Among the findings of the study was that discriminatory attitudes held by men regarding the success prospects of women's entrepreneurship were reduced due to the edutainment TV programme. It more generally showed that TV programmes can change gender-related perceptions around entrepreneurship in Egypt.

Ms Eman El-Hadary explained how RISE Egypt supports social enterprises, 40 per cent of which are (co-) led by women, in upscaling their interventions and maximising impact. Through capacity-building seminars and linking entrepreneurs to national and international experts in the respective sector, RISE helps women-led social enterprises to increase their credibility and reputation in the market which facilitates-key challenges facing young women entrepreneurs- for example access to finance. Mr Ibrahim Melouk agreed on the importance of providing women-led enterprises with a combination of loans and training, an approach which Alexandria Business Association (ABA) has successfully been pursuing in partnership with UN-Women. He described that a modernized M&E system allows ABA to tailor loans to their 175,000+active female borrowers, constituting 49% of their loan portfolio. 

Dr Ali Rashed showcased how Population Council Egypt implemented Neqdar Nesharek, a women's empowerment programme in Upper rural Egypt. He emphasized the inclusive approach to empowerment the intervention adopted. The programme provided business, life skills and vocational training to young women and also involved relatives and small village-based associations. A rigorous impact evaluation showed that the programme significantly increased income-generating activities among trained women. 

Finally, in a short discussion with the audience several participants underlined the importance of further decentralising entrepreneurship training programmes (such as Start and Improve Your Business) to increase access and coverage for and in rural areas.

Edited Fri, Dec 1, 2017 11:21 AM

Women's Entrepreneurship Development Assessments in North Africa

In 2017, the ILO’s Women’s Entrepreneurship Development Programme (WED) has adopted a strong focus on North African countries and launched several publications on that region.

1. National Assessments of Women’s Entrepreneurship Development:

Egypt (English)

Tunisia (French)

Algeria (French)

These reports present an up-to-date picture of the situation of women entrepreneurs in the countries and assesses the current environment supporting Women's Entrepreneurship Development through a set of six framework conditions: (i) existence of a gender-sensitive legal and regulatory system, (ii) an effective policy leadership and coordination for the promotion of WED, (iii) access to gender-sensitive financial services, (iv) access to gender-sensitive BDS services, (v) access to markets and technology and (vi) representation of women entrepreneurs and participation in policy dialogue. To undertake these studies, researchers carried out thorough desk reviews, various in-depth interviews with key stakeholders as well as surveys with women entrepreneurs and focus group discussions.

The assessments come to the overall conclusion that most national efforts to promote entrepreneurship in these countries lack a focus on gender issues and that women entrepreneurs continue to face significant challenges that differ from those for men, such as:

  • Balancing of entrepreneurship with family duties
  • Lack of access to financial and non-financial services
  • Lack of access to markets and technology
  • Lack of access to business networks
  • Weak voice in the policy dialogue process

2. Reports on sectors that are favourable to women’s entrepreneurship

Algeria (French)

Morocco (French)

3. Guides on services supporting women’s entrepreneurship

Algeria (French)

Morocco (French)

Edited Wed, Dec 13, 2017 1:50 PM

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