個人主動性培訓對創(chuàng)業(yè)成功的長期和持久影響

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PolicyResearchWorkingPaper10938

Long-TermandLastingImpactsofPersonalInitiativeTrainingonEntrepreneurialSuccess

FranciscoCampos

MichaelFrese

LeonardoIacovone

HillaryC.Johnson

DavidMcKenzie

MonaMensmann

WORLDBANKGROUP

DevelopmentEconomics

DevelopmentResearchGroupOctober2024

ReproducibleResearchRepository

Averifiedreproducibilitypackageforthispaperisavailableat

,clickherefordirectaccess.

PolicyResearchWorkingPaper10938

Abstract

ArandomizedexperimentinTogofoundthatpersonalini-tiativetrainingforsmallbusinessesresultedinlargeandsignificantimpactsforbothmenandwomenaftertwoyears(Camposetal,2017).Thispaperrevisitstheseentre-preneursaftersevenyears,andfindslong-lastingaverageimpactsofpersonalinitiativetrainingof$91higherprofits

permonth,whichislargerthanthe2-yearimpacts.How-ever,theselong-termimpactsareverydifferentformenandwomen:theimpactformengrowsovertimeastheyaccumulatemorecapitalandincreaseself-efficacy,whereastheimpactforwomendissipates,andcapitalbuild-upismuchmorelimited.

ThispaperisaproductoftheDevelopmentResearchGroup,DevelopmentEconomics.ItispartofalargereffortbytheWorldBanktoprovideopenaccesstoitsresearchandmakeacontributiontodevelopmentpolicydiscussionsaroundtheworld.PolicyResearchWorkingPapersarealsopostedontheWebat

/prwp

.Theauthorsmaybecontactedatdmckenzie@.Averifiedreproducibilitypackageforthispaperisavailableathttp://,clickherefordirectaccess.

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ThePolicyResearchWorkingPaperSeriesdisseminatesthefindingsofworkinprogresstoencouragetheexchangeofideasaboutdevelopmentissues.Anobjectiveoftheseriesistogetthefindingsoutquickly,evenifthepresentationsarelessthanfullypolished.Thepaperscarrythenamesoftheauthorsandshouldbecitedaccordingly.Thefindings,interpretations,andconclusionsexpressedinthispaperareentirelythoseoftheauthors.TheydonotnecessarilyrepresenttheviewsoftheInternationalBankforReconstructionandDevelopment/WorldBankanditsaffiliatedorganizations,orthoseoftheExecutiveDirectorsoftheWorldBankorthegovernmentstheyrepresent.

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Long-termandlastingimpactsofpersonalinitiativetrainingonentrepreneurialsuccess

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FranciscoCampos,MichaelFrese,LeonardoIacovone,HillaryC.Johnson,DavidMcKenzie,MonaMensmann

JELClassificationCodes:O12,O17,L26,J24,J16,D22.

Keywords:Microentrepreneurship;Businesstraining;Personalinitiative;Firmgrowth.

#Campos:WorldBank(email:fcampos@);Frese:AsiaSchoolofBusinessandLeuphanaUniversityofLueneburg(email::michael.frese@.my);Iacovone:WorldBank(email:iacovone@);Johnson:WorldBank(email:hjohnson1@);McKenzie(correspondingauthor):WorldBank(dmckenzie@);Mensmann:UniversityofCologne(email:mona.mensmann@wiso.uni-koeln.de).WethankFrédericCochinardandJean-LucAdzodoforexcellentresearchassistanceonthisphaseoftheproject,andthankseminarparticipantsatY-RISE,theIADB,andNOVAFRICAforhelpfulcomments.WegratefullyacknowledgefundingforthisroundfromtheIPASMEInitiative,andfromtheWorldBankthroughtheEntrepreneurshipforDevelopmentinitiativeandinfoDevmulti-donortrustfund.TheoriginalstudyisregisteredintheAEARCTregistry(AEARCTR-0000888)andwefollowuponthesameprimaryoutcomes.TheWorldBankdoesnothaveanIRB,butinsteadhasaPersonalDataPrivacyProtocolwhichgovernsthecollectionanduseofsurveydata.

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1.Introduction

Canbusinesstrainingprogramsthatshowshort-rungainsinprofitabilityresultinlong-lastingentrepreneurialsuccess?Thereturnoninvestmentfromthebillionsspentbygovernments,aidagencies,microfinanceorganizations,andNGOsontrainingsmallbusinessesindevelopingcountrieswillvarydramaticallydependingontheanswer,yetmostevaluationsonlytrackfirmsforonetotwoyears(McKenzieetal.2023).Alastingandconstantlong-termimpactcouldariseiftrainingimprovesthe“A”termintheproductionfunction,increasingthelong-termsteadystatesizeofthefirm.Theimpactcouldincreaseovertimeiftrainingresultsingrowththroughinnovationandself-reinforcingpsychologicalimpacts.Butconversely,impactsmaybeshort-livediftrainingprovidesinformationthatonlyhelpssolveimmediateproblems,justspeedsupconvergencetoanexistingsteadystatebyhelpingfirmsovercapitalconstraints,orifthereisknowledgeandskilldecayandareversiontopreviousbusinesspracticesandmindsets.Psychologicaltransferstudiesshowsubstantialdecayoverlongertimeperiods(Blumeetal,2010).

Recentliteraturelookingatthelong-termimpactsofcashtransfersandmultifacetedultra-poorprogramsthatinvolveassettransfersalongwithothercomponentshavefoundmixedresultsonbusinessoutcomes.Somestudieshavefoundlastingimpacts,perhapsduetobehavioralreasonsandcashhelpingsmoothshocks(deMeletal.2012),ortoverypoorhouseholdsaccumulatingenoughassetstopotentiallyovercomethresholdeffectsandsustainagriculturalbusinesses(Balbonietal,2022).However,othersfindfade-outduetocontrolgroupcatch-upandconvergence(Barkeretal,2024;Blattmanetal,2020;Blattmanetal,2022;Brudevold-Newmanetal.2024).Bouguenetal.(2019)examinetheemergingevidenceonthelong-runeffectsofdevelopmentinterventionsandnotethat“humancapitalinterventionsappeartobeparticularlyeffectiveinboostinglong-runeconomicoutcomes”(p.529),althoughthisfindingcomesfromhealthandeducationprograms,withnosuchevidenceforentrepreneurialhumancapital.Theyalsonotethatimpactscanoftendiffersubstantiallybygender,andbythepopulationbeingtargeted.

Weexaminethelong-runimpactsofapersonalinitiativetrainingprograminTogo,whichisapsychology-basedprogramdesignedtodevelopaproactiveentrepreneurialmindset(Frese,2024).Inanexperimentwith1,500smallbusinessentrepreneurs,wefoundthatthispersonalinitiativeapproachresultedina30percentimprovementinprofitsovertwoyears,approximatelythreetimesthatofatraditionalbusinesstrainingapproach,withsimilarimpactsforbothmaleandfemale

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entrepreneurs(Camposetal,2017).BasedontheseresultstheWorldBank,Inter-AmericanDevelopmentBank,andseveralNGOshavelaunchedthistraininginmorethanadozencountries.Inthispaperwerevisitthisexperimentsevento7.5yearsaftertraining,

Inthepooledsampleofmenandwomen,wefindalong-termandlastingimpactofpersonalinitiativetrainingonentrepreneurialsuccess.Theentrepreneurshadanaverageageof40atbaselineandhadwell-establishedfirms.Businesssurvivalishigh,with88percentofthecontroland91percentofthepersonalinitiativetraininggroupstillinbusinesssevenyearslater.Theaverageimpactonmonthlybusinessprofitshasgrownfrom$64aftertwoyearsto$91aftersevenyears,whichis52percenthigherthanthecontrolmean.Thisincreaseinprofitsdoesnotcomeattheexpenseoflesswageincome,astotallaborincomerisesbyasimilarmagnitude.Incontrastthelong-termimpactsoftraditionalbusinesstrainingremainaroundone-thirdofthemagnitudeofthoseofpersonalinitiativetraining,andarenotstatisticallysignificant.

However,despitemenandwomenshowingsimilar2-yearimpactsfrompersonalinitiativetraining,wefindverydifferentlong-termdynamics.Thetreatmenteffectsformenhavegrownovertime,andafter7yearstheyseea$148increaseinmonthlyprofits,a77percentincreaseonthecontrolmean.Theyhaveaccumulatedsubstantialamountsofcapital,andentrepreneurialself-efficacyissignificantlyhigher,potentiallygeneratingaself-reinforcingpsychologicalcycle.Incontrast,profitsofwomenhaveconvergedbacktowardsthecontrolgroup,withtheirtreatmenteffectof$39notstatisticallysignificant,andonlyone-quarterofthatformen.Analysisofquantiletreatmenteffectsshowsmenparticularlypullingawayfromwomeninthetophalfoftheirrespectivedistributions.Womenhaveaccumulatedlesscapital,andseeasmallerincreaseintheir“A”component,particularlyinself-efficacy.Weconcludebyexploringdifferentpotentialexplanationsforthelackofsustainedimpactforwomen:differencesinthegrowthpotentialanddemandinthesectorstheyworkin,redirectionoftheireffortsandcapitaltowardsotherhouseholdbusinesses,andinvestmentintheirchildrenandhouseholdinsteadoftheirbusiness.Wecanruleoutotherhouseholdbusinesses,butlimitedsectoraloverlapwithmenandalackofdataonhouseholdoutcomesrestrictwhatwecanconcludeontheseothermechanisms.

2.ExperimentalDesignandPersonalInitiativeTraining

ThestudytookplaceinthecapitalcityLomé,ofTogo,aspartofaWorldBank-financedprojecttosupportprivatesectordevelopment.Eligibilitywasrestrictedtofirmsthatwereinbusinessfor

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atleast12months,wereoperatingoutsideofagriculture,werenotformallyregisteredcompanies,andthathadfewerthan50employees.Acommunicationcampaignin2013attracted3,220firmsthatmetthiseligibilitycriteria,andasampleof1,500werethenselectedfortheexperiment.

A.ExperimentalSampleandDesign

Theexperimentalsampleconsistsof789female-operatedbusinessesand711male-operatedbusinesses.Incontrasttostudieswhichfocusonyouthrunningnewenterprises,andonultra-poorindividualsoperatingsubsistencebusinesses,theentrepreneursinthisstudyareolder(medianageof42forwomenand38formen)andarerunningestablishedfirms(medianfirmageof11yearsforwomenand8yearsformen).82%ofmenand65%ofwomenhadatleastoneotherworkerintheirfirm,withameanof3.8workersformenand1.9workersforwomen.MeanmonthlyprofitsareUS$246formenandUS$173forwomen.

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71%ofthewomenareincommerce,withthetypicalactivitiesbeingsellingfoodandclothing.Hairdressingandsewingaretheothermainactivities.Incontrast,only22%ofthemenareincommerce,withthemajorityspreadacrossarangeofdifferentmanufacturingactivities,aswellasinconstructionandrepairservices.

The1,500firmswerestratifiedbygenderandsector,andgroupedintotripletsaccordingtobaselineprofits.Withineachtriplet,firmswerethenrandomlyassignedtoacontrolgroup(N=500),traditionalbusinesstraininggroup(N=500),andpersonalinitiativetraininggroup(N=500).

B.TheIntervention:PersonalInitiativeTraining

BothbusinesstrainingprogramswereimplementedinApril2014intheformof36hoursofin-personclassroomtrainingspreadoverfourweeks,followedbyatrainervisitingthebusinessforthreehours,oncepermonth,foreachofthenextfourmonthstoassistwithimplementingtheconceptslearned.Bothprogramshadasimilardeliverycostofapproximately$750perinvitedbusiness,andchargedfirmsahighlysubsidizedfeeof$10.Take-uprateswereequalinthetwotrainingprograms,at84percent.

ThetraditionalbusinesstrainingusedtheBusinessEdgeprogramdevelopedbytheInternationalFinanceCorporationandadaptedtotheTogocontext.Itfocusedonteachingstandardbusiness

1WeconvertallfinancialoutcomesintorealSeptember2021U.S.dollarsusinganexchangerateof550.5CFAperUSDandtheTogoConsumerPriceIndexcollectedbyINSEED(

https://inseed.tg/

).

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practicessuchasaccountingandfinancialmanagement,marketing,andhumanresourcemanagement.

Incontrast,personalinitiativetrainingisapsychology-basedapproachthataimsatcreatingaself-starting,future-oriented,andpersistentproactivemindset(MensmannandFrese,2017).Thetrainingcontainsexercisesdesignedtofosterinnovation,aswellaslookingforopportunitiestolearnfromsetbacksandtodifferentiateoneselffromotherbusinesses.Anotherkeycomponentofthetrainingemphasizesfinancialbootstrapping,throughlookingforwaystoaddressfinancialchallengeswithouttakingonbankloansorusingmicrocredit.Exerciseshaveentrepreneursbrainstormtothinkthroughapproacheslikesecuringadvancepaymentsfromcustomersormorefavorabletermsfromsuppliers,andself-fundingtowardsmeetingabusinessgoal.Camposetal.

(2017)andMensmannandFrese(2017)providemoredetailsofthetrainingcontent.

C.DataandAttrition

Ourshort-termresultsinCamposetal.(2017)usethebaselinesurveytakeninDecember2013,andfourroundsoffollow-upsurveyscollectedbetweenSeptember2014andSeptember2016.Averagingtheseroundstogethergaveprofitandsalesimpactsoverthefirst2yearsandfivemonthsaftertraining.Responseratesforthesefollow-uproundsrangedfrom89to95percent(TableA1).Long-termfollow-upsurveystomeasureimpacts7to7.5yearspost-trainingwereconductedbythesurveyorganizationAdKontactTogoin2021.WebeganwithaphonesurveyinMarch-April2021,andwereabletointerview1035entrepreneurs(69%).Thiswasfollowedbyanin-personsurveyinSeptember-October2021,whichinterviewed1131entrepreneurs(75%).Combiningthetwosurveys,wehaveinterviewsfor1250owners(83.3%),andinadditionwereabletoascertaintheoperatingstatus(includingclosures)ofafurther91firms,sothattheoperatingstatusof1341firms(89.4%)isknown.

Althoughthisoverallresponserateishigh,TableA1showsthatitvarieswithtreatmentstatus,withresponseratesforthecontrolgroup7to8percentagepointslowerthanthepersonalinitiativetraininggroup.Wepursueseveralstrategiestoshowthatourresultsareunlikelytobedrivenbyattrition.First,followingGhanemetal.(2023),weshowthatboththesampleofnon-atttritors

(TableA2a)andofattritors(TableA2b)arebalancedonbaselinecharacteristicsacrossallthreegroups.Whilenotstatisticallydifferent,ifanythingthecontrolgroupfirmsthatremainweredoingslightlybetteronbaselineprofitabilityandcapitalstockthanthepersonalinitiativefirms,

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suggestingitwasthelessprofitablecontrolfirmsthatweremorelikelytoattrit.Second,weexaminedynamicselectionintoattritioninTableA3,comparingfirmswhichansweredboththein-personandphonesurveys,tothosewhichansweredonlyone,andtotheattritors.Weseethatthefirmsthatwerehardertogettorespondwereonesthatwerelesslikelytobestilloperatingaftertwoyears,andthatweremorelikelytohavebelowmedianprofits.Theattritorsthereforeappeartobelesssuccessfulentrepreneursonaverage,makingourestimatesoflong-termtreatmenteffectslikelytobelowerbounds(sincewearemissingmoreless-successfulcontrolfirmsthanless-successfultreatedfirms).Weadditionallyshowtheresultsarerobusttodifferentsetsofrobustnesscontrolsandtodifferentboundingassumptionsabouttheself-employmentstatusandprofitsoftheseattritors(TablesA4andA5).Finally,wenotethattheattritionratesforthetraditionalbusinesstraininggrouparesimilartothoseofthepersonalinitiativegroup,andsocomparisonsbetweenthesetwogroupsshouldbelessaffectedbyattrition.

D.Estimation

Weestimatethefollowingpaneldataequationforfirmiinrandomizationstratasattimet,usingour4short-termroundsandcombinedfifthlong-termfollow-upround:

yi,t=α+βsr1(t≤4)*PIi+βlr1(t=5)*PIi+ysr1(t≤4)*TRADi+ylr1(t=5)*TRADi+PSRyi,0+PLRyi,0+δt+μs+εi,t(1)

Where1(t≤4)and1(t=5)areindicatorvariablesfortheshort-runandlong-runsurveyroundsrespectively,PIdenotesassignmenttothepersonalinitiativetraining,TRADdenotesassignmenttotraditionalbusinesstraining,yi,0isthebaselinevalueofthedependentvariable,δtaresurveyroundfixedeffects,μsarerandomizationstratabyshort-orlong-runfixedeffects,andthestandarderrorsεi,tareclusteredatthefirmlevel.

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βsrthengivestheshort-runeffectofpersonalinitiativetrainingaveragedoverthefourinitialsurveyrounds,andβlrthelong-runeffectat7to7.5yearspost-training(withysrandylrdefinedlikewiseastheshort-runandlong-runeffectsoftraditionalbusinesstraining).Wethentestβsr=βlrtotestwhethertheimpactofpersonalinitiativetrainingisconstantovertime,andcanalsotestβlr=ylrtotestwhetherpersonalinitiativetraininghasthe

2Weusethissaturatedformulationwhichallowsthestrataandcoefficientonthelaggedvariabletovarywithshort-andlong-run,sothattheestimatedshort-andlong-runtreatmenteffectcoefficientsarethesameasthosewhichwouldbeobtainedbyestimatingthismodelseparatelyforthetwotimeperiods.

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samelong-runimpactastraditionalbusinesstraining.Wealsoexamineheterogeneityinimpactsbygender,byinteractingallthevariablesinequation(1)withanindicatorforthegenderofthefirmowner.

Ourmainoutcomeofinterestisbusinessperformance,whichweexaminebylookingatprofitabilityandsales.Thesewerethemainprimaryoutcomesspecifiedinouroriginalpre-analysisplan,andinourmainresultstableinCamposetal.(2017).Threeissuesareworthnotinginexaminingtheseoutcomes.First,profitsandsalesareonlymeasuredforfirmsthatarestilloperating.Figure1A,andTableA4showthat88%ofcontrolfirmsarestillsurvivinginourlong-termfollow-up,withthepersonalinitiativegroupbeingastatisticallyinsignificant3percentagepointsmorelikelytosurvive.Weestimateimpactsonunconditionalprofits,whichuseallfirmsandcodeclosedfirmsashavingzeroprofits,aswellasimpactsonprofitsconditionalonsurvival.Second,25percentofthesampleoperatesmorethanonefirmbythelong-termfollow-up.Wethereforeexamineprofitsandsalesintheirmainfirm,aswellasacrossallfirmscombined.Third,profitsandsalesarehighlyskewedoutcomes.Wewinsorizeatthe1stand99thpercentiles,andalsoexaminequantiletreatmenteffectsonprofits,giventheissuesininterpretinglog-liketransformations(ChenandRoth,2024).Finally,inadditiontobusinessprofits,wealsoexaminetotallaborearnings,whichcombinesprofitswithanyincomeearnedfromwagework.

WefollowsuggestionsbyVivianoetal.(2024)inourapproachtomultiplehypothesistesting.Ourmaininterestisinthepersonalinitiativetrainingtreatment,andsowedonotadjustforthepresenceofasecondtreatment(traditionaltraining)thathaslimitedscaleeconomies.Wethenseefirmprofitsasthemainprimaryoutcome,anduseindexmeasurestoaggregatesecondarymechanisms.

3.WhymightPersonalInitiativeTrainingHave(orNotHave)SustainedImpacts?

Anentrepreneuroperatinginindustryiwithproductionfunctionfi(.),chooseshowmuchcapitalK,andlaborLtouseintheirbusinessinordertomaximizeprofits,subjecttoaborrowingconstraintBonhowmuchcapitaltheyareabletoaccess:

a,LxPfi(A,K,L)?rK?WLS.t.K≤B(2)

wherepistheiroutputprice,randwthecostofcapitalandlaborrespectively,andAincludesentrepreneurialskills,knowledge,ability,andpersonalitythatdeterminehowefficientlyinputscanbeturnedintooutput.Then,asinLucas(1978),theoptimalsteady-statesizeofthefirmwill

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dependonA,whilecredit-constrainedfirmswillbeoperatingbelowtheefficientscaleuntiltheycanaccumulatemorecapital.

Thereareseveralpotentialmechanismsthroughwhichpersonalinitiativetrainingcouldthenchangethismaximizationproblem,withdifferingpredictionsforwhetherweshouldexpectlastingimpactsfromtraining.

TrainingincreasesA,increasingtheoptimalsteadystatesizeofthefirm,leadingtothetreatmentimpactpersistingovertime:WecanthinkofatleastthreecomponentsofAwhichtrainingmightaffect.Thefirstisbusinesspractices,suchasrecord-keepingandmarketingpractices.SecondarepsychologicalaspectsofA,suchaspersonalinitiative,andentrepreneurialself-efficacy.Thirdisinnovationandtechnology,whichcanalsobethoughtofaspotentiallychangingtheproductionfunctionf()itself.AnincreaseinAshouldthencausealong-termincreaseinprofitabilityandsizeofthefirm,sothatweshouldexpectthegapbetweenthepersonalinitiativetreatmentgroupandcontrolgrouptopersistovertime.However,ifincreasesinAareshort-lived,thenanyincreasewillbetemporary.Firmsmaystopusingbetterbusinesspracticesovertime(Bloometal.,2020finddecayintheuseofmanagementpracticeimprovementsinmuchlargerfirmsovertime).Knowledgeandskilldecayandfatiguemaycauseentrepreneurstoreducetheamountofpersonalinitiativeovertime(MensmannandFrese,2019),andexternalshockstothebusinessmaytakeawayfocusandsetinplaceanegativefeedbackcycleinwhichtheyloseconfidenceintheirabilities.Changesinmarketdemandandtechnologicaldepreciationmaymeanthatnewproductsandtechnologiesintroducedimmediatelyaftertrainingmaynolongerbeasprofitableaftermultipleyears,andsounlessentrepreneurskeepinnovating,Awillfallbacktowardsinitiallevels.

Trainingmayrelaxborrowingconstraints,speedingupconvergencetoasteady-state,butwiththecontrolgroupcatchingupovertimeandthetreatmenteffectdecreasingovertime:ThefinancialbootstrappingaspectofpersonalinitiativetrainingmayhavehelpedentrepreneurstorelaxtheborrowingconstraintK≤B.Ifthisistheonlyimpactoftraining,andthereisnochangeintheoptimalsteadystatesize,thenweshouldexpectimpactstodecayovertimeasthecontrolgroupmoreslowlyaccumulatescapital.Twopotentialavenuesforalong-termimpacthereareiftrainingalsolowersthecostofobtainingcapitalr,therebyincreasingtheoptimalsizeofcapitalatwhichthemarginalproductofcapitalequalsr,oriftherearebehavioralconstraintsthatmakeitdifficult

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forthecontrolgrouptoreinvestprofitsintheirbusinessevenwhenthereturnoncapitalexceedsr(asdiscussedforcashtransfersindeMeletal,2012).

ThereisalsothepossibilityofthetreatmenteffectincreasingovertimeifincreasesinAbecomeself-reinforcing.AfurtherpossibilityisthatthereisnotjustalevelincreaseinA,butthattraininginducesanendogenousgrowthprocesswherebyentrepreneurscankeepincreasingtheirlevelofAfurtherovertime.Thiscouldoccuriftheyareabletocontinuallyintroducenewinnovations,orthroughaself-reinforcingpsychologicalchannel,wherebyhigherprofitabilityencouragesandreinforcestrainedbehavior,leadingentrepreneurstobecomemoreconfidentandinvestfurtherinusingthetraining.Inaddition,iftraininghelpsfirmsbettersurviveshocks,thenovertimeasfirmscumulativelyfacemoreandmoreshocks,treatmenteffectscouldfurtherdivergethroughasurvivaleffect.

4.Long-TermFollow-upImpacts

4.1Long-TermImpactsonBusinessPerformanceinthePooledSample

Webeginbypoolingtogethermenandwomen,toestimateimpactsonthefullsample.Figure1plotsmeansurvival,profits,andnumberofemployeesovertimebytreatmentstatus.InpanelAweseethatsurvivalratesremainhighafter7years,at88percentforthecontrolgroupand91percentforthepersonalinitiativetraininggroup.This3percentagepoint(p.p.)differenceisnotstatisticallysignificant.TableA4examinesthesurvivalimpactunderdifferentassumptionsaboutthesurvivalofattritors,andshowsthatthisimpactwouldgrowto5.4p.p.ifhalfofallattritorswereclosed,and8.8p.p.ifallattritorswereclosed.

PanelsBandCthenexamineourkeyoutcomeofbusinessprofitability,withpanelBcodingclosedbusinessesashavingzeroprofits,andpanelCconditioningonsurvival.Weseethatprofitabilityofcontrolgroupfirmshasnotgrownbetween2013and2021,withsurvivingfirmsearning$196permonthonaveragein2021,comparedto$202permonthin2013.Incontrast,thepersonalinitiativetraininggroupincreasesprofitsrelativetoboththecontrolandtraditionaltraininggroupsoverthefirsttwoyears,andthisgappersistsoverour7to7.5yearfollow-upperiod.

Table1showsastatisticallysignificanttreatmenteffectofpersonalinitiativetrainingonprofitsinthemainbusinessof$59permonthafter2-yearsand$72permonthafter7-years.Theimpacts

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acrossallbusinessesrunbytheentrepreneurareslightlylargerat$64permonthafter2-yearsand$91permonthafter7-years,suggestingthatwhilemostoftheeffectcomesthroughthemainbusiness,thereisalsosomegrowthindiversifiedactivities.Thedifferencebetweentheshortandlong-termimpactisnotsignificant(p=0.336);thisisalsotrueforprofitsconditionalonsurvival,Salesinallbusinessesareup$423permonthinthepersonalinitiativegroupafter7-years.Combiningourmainbusinessprofitandsalesmeasuresintoastandardizedindex,weseeastatisticallysignificantlong-termimpactof0.19standarddeviations.Thegrowthinprofitsisnotcomingattheexpenseoflowerlaborearningsfromwagework,astotallaborearningsfromboththebusinessandotherlaboractivitiesareup$89over7-years.Incontrast,thelong-termimpactsoftraditionalbusinesstrainingarenotstatisticallydifferentfromzero,arestatisticallydifferentfrompersonalinitiativetraining,andareapproximatelyone-quartertoone-thirdofthemagnitudeofthepersonalinitiativeimpacts.

TableA5showsthesignificantincreaseinprofitstoberobusttodifferentassumptionsaboutattrition.TableA6alsoexaminesimpactsonlogprofitsandsales,profitsandsalesinthebestandworstmonthsoftheyear,andrecallofprofitsandsalesinthebestandworstmonthsof2019.PersonalInitiativetrainingdoesnotboostprofitsorsalesintheworstmonthsoftheyearforbusiness,buthasevenlargerimpactsinthebestmonths.

Thislong-termimpactofpersonalinitiativetrainin