Capital, Skills and the Economic Lives of the Poor: Recent Evidence From Field Experiments

Poor women throughout the developing world are typically engaged in low return, irregular and insecure wage jobs or sluggish microenterprises, which yield low and unstable earnings. Poor women also typically have very low levels of physical and human capital. Taken together, these observations have led the design of many antipoverty programs based on the assumption that lack of capital and skills determines occupational choice, and that, therefore, transferring capital or skills will enable the poor to enter into more productive occupations and lead to sustainable improvements of their livelihoods.

The aim of this paper is to present evidence from a series of interventions that tackle the capital and skills constraints either separately or simultaneously, to understand whether relaxing these can indeed transform the economic lives of poor women. Throughout we focus on interventions that: (i) explicitly target capital and skill constraints either separately or simultaneously; (ii) are evaluated through field experiments that compare outcomes of randomly chosen treatment and control groups.