Publication:
Returns to Capital in Microenterprises: Evidence from a Field Experiment

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Academic Peer ReviewExternal Content
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Date
2008
ISSN
00335533
Published
2008
Author(s)
de Mel, Suresh
Woodruff, Christopher
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Abstract
We use randomized grants to generate shocks to capital stock for a set of Sri Lankan microenterprises. We find the average real return to capital in these enterprises is 4.6%-5.3% per year), substantially higher than market interest rates. We then examine the heterogeneity of treatment effects. Returns are found to vary with entrepreneurial ability and with household wealth, but not to vary with measures of risk aversion or uncertainty. Treatment impacts are also significantly larger for enterprises owned by males; indeed, we find no positive return in enterprises owned by females.
Link to Data Set
http://microdata.worldbank.org/index.php/catalog/1243
URI
https://hdl.handle.net/10986/5590
Associated URLs
http://search.ebscohost.com/login.aspx?direct=true&db=eoh&AN=1009462&site=ehost-live
http://www.mitpressjournals.org/loi/qjec
https://openknowledge.worldbank.org/handle/10986/7124
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