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Impacts of Industrial and Entrepreneurial Jobs on Youth: 5-year Experimental Evidence on Factory Job Offers and Cash Grants in Ethiopia

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  • Christopher Blattman
  • Stefan Dercon
  • Simon Franklin

Abstract

We study two interventions for underemployed youth across five Ethiopian sites: a $300 grant to spur self-employment, and a job offer to an industrial firm. Despite significant impacts on occupational choice, income, and health in the first year, after five years we see nearly complete convergence across all groups and outcomes. Shortrun increases in productivity and earnings from the grant dissipate as recipients exit their micro-enterprises. Adverse effects of factory work on health found after one year also appear to be temporary. These results suggest that one-time and one-dimensional interventions may struggle to overcome barriers to wage- or self-employment.

Suggested Citation

  • Christopher Blattman & Stefan Dercon & Simon Franklin, 2019. "Impacts of Industrial and Entrepreneurial Jobs on Youth: 5-year Experimental Evidence on Factory Job Offers and Cash Grants in Ethiopia," NBER Working Papers 25788, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:25788
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    2. Giambra, Samuele & McKenzie, David, 2021. "Self-employment and migration," World Development, Elsevier, vol. 141(C).
    3. Gu, Jiajia, 2021. "Financial intermediation and occupational choice," Journal of Economic Dynamics and Control, Elsevier, vol. 133(C).
    4. Paul,Boban Varghese & Dutta,Puja Vasudeva & Chaudhary,Sarang, 2021. "Assessing the Impact and Cost of Economic Inclusion Programs : A Synthesis of Evidence," Policy Research Working Paper Series 9536, The World Bank.
    5. Edmonds, Eric & Theoharides, Caroline, 2020. "The short term impact of a productive asset transfer in families with child labor: Experimental evidence from the Philippines," Journal of Development Economics, Elsevier, vol. 146(C).
    6. Stöterau, Jonathan, 2019. "Job training programs for youth in low-income countries," PEGNet Policy Briefs 15/2019, PEGNet - Poverty Reduction, Equity and Growth Network, Kiel Institute for the World Economy (IfW Kiel).
    7. Lafortune, Jeanne & Pugatch, Todd & Tessada, José & Ubfal, Diego, 2022. "Can interactive online training make high school students more entrepreneurial? Experimental evidence from Rwanda," GLO Discussion Paper Series 1041, Global Labor Organization (GLO).
    8. Craig McIntosh & Andrew Zeitlin, 2022. "Skills and Liquidity Barriers to Youth Employment: Medium-term Evidence from a Cash Benchmarking Experiment in Rwanda," Papers 2209.08574, arXiv.org.
    9. Tefera,Girum Abebe & Buehren,Niklas & Goldstein,Markus P., 2020. "Short-Run Welfare Impacts of Factory Jobs : Experimental Evidence from Ethiopia," Policy Research Working Paper Series 9325, The World Bank.
    10. Grover,Arti Goswami & Imbruno,Michele, 2020. "Using Experimental Evidence to Inform Firm Support Programs in Developing Countries," Policy Research Working Paper Series 9461, The World Bank.
    11. Matthew W. Ridley & Gautam Rao & Frank Schilbach & Vikram H. Patel, 2020. "Poverty, Depression, and Anxiety: Causal Evidence and Mechanisms," NBER Working Papers 27157, National Bureau of Economic Research, Inc.
    12. González, Felipe & Prem, Mounu & von Dessauer, Cristine, 2024. "Empowerment or Indoctrination? Female Training Programs under Dictatorship," IZA Discussion Papers 17163, Institute of Labor Economics (IZA).
    13. Annie Alcid & Erwin Bulte & Robert Lensink & Aussi Sayinzoga & Mark Treurniet, 2023. "Short- and Medium-term Impacts of Employability Training: Evidence from a Randomised Field Experiment in Rwanda," Journal of African Economies, Centre for the Study of African Economies, vol. 32(3), pages 296-328.
    14. Avalos,Jorge Eduardo & Bossuroy,Thomas & Clay,Timothy Joseph Peter & Dutta,Puja Vasudeva, 2023. "Productive Inclusion Programs in Urban Africa," Social Protection Discussion Papers and Notes 183525, The World Bank.

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    More about this item

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J81 - Labor and Demographic Economics - - Labor Standards - - - Working Conditions
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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