Data and Code for: Big Loans to Small Businesses: Predicting Winners and Losers in an Entrepreneurial Lending Experiment

Principal Investigator(s):  View help for Principal Investigator(s) Gharad Bryan, London School of Economics; Dean Karlan, Northwestern University; Adam Osman, University of Illinois

Version:  View help for Version V1

Name File Type Size Last Modified
ITE_ID_Monthly Profit.dta application/x-stata-dta 7.8 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation1.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation10.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation100.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation11.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation12.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation13.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation14.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation15.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
ITE_Psy1_50_Cog_Monthly Profit_100Simulation16.dta application/x-stata-dta 352.4 KB 05/24/2024 01:31:PM
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Project Description

Summary:  View help for Summary We experimentally study the impact of relatively large enterprise loans in Egypt. Larger loans generate small average impacts, but machine learning using psychometric data reveals that "top-performers" (those with the highest predicted treatment effects) substantially increase profits, while profits drop for poor-performers. The large differences imply that lender credit allocation decisions matter for aggregate income, yet we find that existing practice leads to substantial misallocation. We argue that some entrepreneurs are over-optimistic and squander the opportunities presented by larger loans by taking on too much risk, and show the promise of allocations based on entrepreneurial type relative to firm characteristics. 

Scope of Project

Subject Terms:  View help for Subject Terms Randomized Experiment
JEL Classification:  View help for JEL Classification
      C93 Field Experiments
      D22 Firm Behavior: Empirical Analysis
      G32 Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
      L26 Entrepreneurship
      O12 Microeconomic Analyses of Economic Development
Geographic Coverage:  View help for Geographic Coverage Egypt
Universe:  View help for Universe Approved loan applicants to "Tamouh" program at Alexandria Business Association
Data Type(s):  View help for Data Type(s) administrative records data; experimental data; survey data
Collection Notes:  View help for Collection Notes Data collection received CAPMAS approval from government of Egypt. 

Methodology

Response Rate:  View help for Response Rate Overall response rate was 96%
Sampling:  View help for Sampling Applicants to a microfinance organization
Data Source:  View help for Data Source Collected by researchers, and lender administrative data
Collection Mode(s):  View help for Collection Mode(s) face-to-face interview; other
Unit(s) of Observation:  View help for Unit(s) of Observation Individuals

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Published Versions

V1 [2024-07-30]

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DDI 2.5

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