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YouWiN Impact Assessment Report

The modal firm size in most developing countries is one worker, consisting of only the owner of
the firm. Among the firms that do hire additional workers, most hire fewer than 10. Hsieh and
Olken (2014, p.93) report that in India and Indonesia “the fraction of firms with less than 10
workers is almost visually indistinguishable from 100 percent.” Likewise in Nigeria, survey data
indicate that 99.6 percent of firms have fewer than 10 workers.1
This is in sharp contrast to the
United States, where the modal manufacturing firm has 45 workers (Hsieh and Klenow, 2014).
Are there constrained entrepreneurs in developing countries with the ability to grow a firm beyond
this 10-worker threshold? If so, this raises the questions of whether such individuals can be
identified in advance, and of whether public policy can help them overcome these constraints to
firm growth?
I investigate these questions through the context of an evaluation of the impact of a national
business plan competition in Nigeria. The YouWiN! competition was launched in late 2011 by the
President of Nigeria, and in its first year attracted almost 24,000 applications aiming to start a new
business or expand an existing one. The top 6,000 applications were selected for a 4-day business
plan training course, and then 1,200 winners were chosen to receive awards averaging US$50,000
each. 729 of the 1,200 winners were randomly selected from a group of 1,841 semi-finalists,
providing experimental variation from US$36 million in grants that enables causal estimation of
the program’s impact, as well as a fair and transparent way of deciding among applications. Three
annual follow-up surveys enable tracking the trajectory of impacts.
Please click on the link to access the full report YouWiN Impact Assessment Report David M

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