Skills training and business outcomes: Experimental evidence from Liberia

Abstract

Small firms account for a large share of employment in developing countries. A standard approach aimed at improving start-up, survival, and growth entails training the entrepreneur in basic managerial and technical skills. However, recent meta-analyses find that standard business training programs result in modest impacts on the sales and profits of entrepreneurs in developing countries. More recently, there has been a growing interest in studying whether training programs that aim to increase the stock of soft skills associated with successful entrepreneurship can impact business outcomes. This study adds to this line of work by testing the relative effectiveness of providing standard training complemented with interpersonal skills training. Targeting about 570 small entrepreneurs in Liberia, the main findings show that the combined training does not result in additional gains in profits and sales relative to the standard training. However, training on soft skills seems to reinforce the message given in the traditional training about long-term goals. Both training programs have no impact on self-reported customer experiences and satisfaction.