Promoting Small and Medium Enterprise Growth and Entrepreneurship in Developing Countries — Capacity Building

In this project, we explore how managerial human capital contributes to the growth of small and medium enterprises in an effort to help practitioners and policymakers design more efficient and effective interventions, as well as to extend the frontier of knowledge on the relationship between human capital and firm growth. In order to examine these issues, we will explore two different lines of inquiry: (1) the importance of selecting the right firms for skill building and (2) analyzing different mechanism for delivering this training. For each line of inquiry, we will investigate the key research questions by leveraging rigorous, evidence-based research techniques across multiple projects in multiple countries. We expect to deliver 5 peer-reviewed articles, as well as the associated data sets. To ensure the results reach the key stakeholders in the policymaking community, we will also develop policy briefs and hold a working group for dissemination and training. This project has the potential to transform the way that developing country policymakers, development practitioners, donor organizations and private sector actors work to support human capital building by documenting which delivery mechanisms and firm selection techniques yield the greatest return on investment. Our work will contribute to a deeper understanding how managerial capital (or the lack thereof) affects firm growth, and will provide insights for designing more effective and scalable models of skill building interventions by private and public institutions. As a result, this project can help to raise incomes, create jobs, and reduce poverty around the world by leveraging market-based principles.