This is the 6th in this year’s series of posts by PhD students on the job market.
Traditionally, development programs have focused on alleviating development constraints that are external to potential beneficiaries, such as a lack of resources, infrastructure, or information. However, recent theories suggest that internal, psychological factors also play a key role. Apart from aspirations, norms, and values, these internal factors include beliefs about one’s capacity to successfully accomplish specific tasks or goals commonly referred to as self-efficacy.
Many development programs, particularly those aimed at building human capital, face low participation rates. In some cases, less than 50% of enrolled individuals ultimately participate, even when programs are free and provide substantial benefits. Apart from unrealized opportunities for individuals, low participation rates can result in unused capacity, program delays, and costly enrollment repetitions. Why do eligible individuals fail to take advantage of these opportunities? One explanation may be that addressing external constraints alone is not enough to foster development.
Acknowledging internal constraints as another potential challenge for development, I argue that even well-designed programs targeting external constraints may not reach their full potential if internal constraints remain overlooked. In my job market paper, I analyze whether combining efforts to overcome both external and internal constraints can improve individuals’ investments in vocational training.
Experimental Design: A Testimonial Campaign
Against this backdrop, I designed a testimonial campaign aimed at boosting self-efficacy using a randomized controlled trial. The campaign targeted 1,109 young women who had registered for a vocational skills training program in Ghana. Training was offered in dressmaking, beauty therapy, and hairdressing, with a curriculum focused on manual and basic entrepreneurial skills. Its design provides an ideal scenario to study if addressing internal constraints can improve training participation.
First, traditional external barriers to participation were minimized because the training was free of charge and participants received monthly stipends to cover transportation and food expenses. Second, a rigorous impact evaluation of the training confirms that the training was beneficial for participants’ welfare in terms of job quality and mental health. Third, the registration included career and counseling services such that the sample consisted solely of women (initially) committed to participating in the training. Despite these efforts, only about half of the registered and invited women started the training. Lastly, the training’s target group were young women aged 16 to 24 years, many of whom worked as head porters in marketplaces, carrying goods for minimal fees under harsh and unstable conditions, who seem particularly well-suited for a self-efficacy intervention.
My campaign consisted of two testimonial videos, each three minutes long, sent via individualized links in text messages, and a series of follow-up text messages. The first video was sent after women had registered but before the training started. The second video and follow-up messages were sent during the training period. Participants were divided into three equally sized groups: a treatment group received self-efficacy testimonials, a neutral test group received testimonials reiterating information that was shared during registration for the training about potential benefits of vocational training, and a control group received no testimonials at all.
The self-efficacy testimonials featured relatable success stories of Ghanaian women who had overcome similar challenges to those faced by study participants using perseverance, goal setting, and resilience – core elements of self-efficacy. Descriptive literature shows a strong correlation of self-efficacy with educational aspirations and achievements. Theoretical frameworks underscore the relevance of aspirations for investment decisions and predict that individuals might remain at lower human capital levels not (only) due to limited resources, i.e., the traditional idea of poverty traps, but also due to behavioral characteristics like low aspirations. For my setting, I expect that higher self-efficacy will lead to higher aspirations for human capital investments, ultimately enhancing training participation.
Effect on Self-Efficacy and Training Participation
Overall, 35% of the individualized video links were clicked on, which is a substantially higher rate than in comparable message-based interventions. Moreover, eight months after the last text message was sent, 20% of the women assigned to the self-efficacy testimonials remembered the content of the campaign. More importantly, self-efficacy increased by 0.14 standard deviations for women who were sent the self-efficacy testimonials – similar to effect sizes achieved by more intensive in-person interventions. Untargeted psychological outcomes, including mental health, self-esteem, conscientiousness, and life satisfaction, remained unchanged.
Figure 1 illustrates the impact of the self-efficacy testimonials compared to no testimonials on three indicators of training participation: (i) self-reported training start, (ii) self-reported training completion among those who started, and (iii) attendance days as recorded in administrative attendance sheets. In the total sample (orange), there is no significant difference in training start between treated and untreated women. However, the self-efficacy testimonials significantly and noticeably increased training completion by 8.1 percentage points. This represents a 10.5% increase over the control group.
Figure 1. Effect on training participation by baseline education.
Note: Each marker represents the treatment effect from separate OLS regressions with 95% confidence interval for the impact of the self-efficacy testimonials on three training participation indicators (panels) across different samples (rows).
What drove these improvements? Splitting the sample by baseline educational attainment (blue, Figure 1), self-efficacy level (green), and exposure to external constraints (pink), shows that the intervention was particularly effective for women with medium education levels but initially lower self-efficacy. On top of that, women who faced larger external constraints to training participation – such as childcare responsibilities, being married or in a relationship, and language barriers – benefitted the most from the intervention. This mirrors predictions from the theoretical framework I develop in the paper and related models in the literature.
Figure 2 presents the effect of the self-efficacy testimonials on training. Women who were sent the self-efficacy testimonials reported significantly higher skills acquisition in their trained occupation (skills in other occupations remained unaffected), higher perceived usefulness of the training, and they were more likely to be selected for job placements that were offered to the top-performing trainees. However, the improved training participation did not extend to employment outcomes post-training, measured by employment rates and income in Figure 2.
Figure 2. Downstream outcomes.
The improvements in participation are combined with a compositional change observed in terms of who started the training. Women who were sent the self-efficacy testimonials and started the training had higher baseline education, higher levels of depression, a stronger present bias, lower stress levels, fewer working hours, and a higher likelihood of being employed compared to women who started the training but were not sent any testimonials.
Lastly, the neutral testimonials did neither affect self-efficacy, any of the other psychological outcomes, nor training participation, even though their delivery was equally successful in terms of clicks and participants remembering the content. Thus, the effects of the self-efficacy testimonials cannot be explained by a mere reminder effect. Instead, the observed impact was specific to the self-efficacy boost that changed who started the training and how women performed.
A Low-Hanging Fruit for Development Programs?
The results suggest that boosting self-efficacy can increase engagement and improve outcomes in skill-building programs, with important implications for the design of future development programs. First, self-efficacy can be significantly increased through low-cost, scalable text-message-based interventions. Second, addressing internal constraints, specifically low self-efficacy, can improve program completion rates. Although effect sizes are modest, their ease of implementation makes such interventions valuable complements to conventional development programs. By improving participation rates, these interventions can unlock greater human capital investments and allow programs to realize their full potential. Third, the effectiveness of such interventions varies depending on individual characteristics, including human capital endowments, prior self-efficacy, and external constraints. These distinctions are essential for optimizing intervention targeting.
Sarah Frohnweiler is a PhD student at the RWI – Leibniz Institute for Economic Research and the University of Göttingen.
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