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Kenya

Long-term effects of a short-term boost to savings – are mental accounts the key to why more small businesses don’t take advantage of high returns?

David McKenzie's picture
Standard economic theory would suggest that a one-time infusion of cash should have at most a temporary effect on business profitability – over time, individuals facing high returns should be able to re-invest business profits and bit-by-bit bootstrap themselves up to the steady-state size. Yet in an experiment I did with Suresh de Mel and Chris Woodruff in Sri Lanka, we find a one-time grant has sustained impacts five years later on male microenterprise owners.

Education, fertility and HIV: It’s complicated

Markus Goldstein's picture

An interesting, recently revised working paper by Duflo, Dupas and Kremer looks at the effects of providing school uniforms, teacher training on HIV education, and the two combined. This paper is useful in a number of dimensions – it gives us some sense of the longer term effects of these programs, the methodology is interesting (and informative), and finally, of course, the results are pretty intriguing and definitely food for thought.