The impact of entrepreneurship training and credit on the labour market outcomes of disadvantaged young people

Abstract

This paper estimates the impact of a program providing classroom and on-the-job entrepreneurship training followed by the provision of a loan to disadvantaged youth. We find that the program increases employment by seven percentage points and income by 21 per cent. The impact is larger for women than men. Furthermore, the results demonstrate an increase in the propensity to save by 17 percentage points with an increase in both the amount of loan taken and outstanding. Nevertheless, the effect of the training component of the program shows no statistically significant impact on income and hours worked. However, the additional impact of the loan component is notable, increasing hours worked as well as earnings.