Supporting micro-enterprise in humanitarian programming: Clan network and business performance in Somalia

There are three intervention componetns that are varied among four groups of beneficiary households. These are - a) unconditional cash transfer with two monthly installments, b) one-off business grant, and c) a weeklong business training (conducted by a consultant for 1-2 hours per day).

2017-01-16

2017-03-31

Ownership of microenterprise, profit from the enterprise, total household income, per capita household consumption.

Profit from microenterprises will be calculated from data recalled for the 6-months prior to survey.
Total household income will combine income from enterprises, livestock rearing, crop production and wage employment in the last 6 months.
Consumption is recalled for the last one month for recurrent items (food, fuel, rent, education etc.) and for the last 6 months for infrequent items (clothes, furniture etc.). Housheold size will be used for calculating per capita expenditure.
Monetary values of profit, income and consumption will be winsorized at 95th percentile.

Amount of savings, amount of outstanding loan, business management practices, business value.

Business practices will include specific indicators on whether keeps written records of transactions, whether hired employee, whether south loan, whether does credit purchase.
Business value will combine values of shop, furniture, equipment, goods and working capital.

Because of ethical as well as feasibility concerns, we did not include a pure control group who receive no support whatsoever. Field officers of the partner organization identified 800 eligible beneficiaries following standard selection process. The community was informed that the amount of transfer received by the households are to be determined at a later stage although all the selected households will receive grants. There were four types of transfers included in the public lottery.
- Group 1: Cash transfer of USD 175, on average, in two equal instalments
- Group 2: Cash transfer of USD 175, on average, in one instalment
- Group 3: Cash transfer of USD 500 in one instalment
- Group 4: Cash transfer of USD 1,000 in one instalment
Besides the variation in transfer size, there is another important difference for Group 2, 3 and 4 compared to Group 1. For Group 1, the transfer was framed as unconditional cash transfer whereas the other three groups were told about the transfers as business grants. Beneficiaries of these three business grant groups also participated in weeklong business training conducted by a consultant for 1-2 hours per day. The training covered generic modules on planning, accounting, costing and marketing. This training took place after the business grants were disbursed, and there was no conditionality attached for the use of cash. The transfer took place in Jan and Feb of 2017 after the baseline survey. A follow-up survey was conducted in mid-2017 where 752 of the baseline sample of 795 (5 households could not be interviewed at baseline) with an attrition rate of 5.4%.

Public lottery

Households stratified at community level

No

800 households

800 households

200 in each of the four groups.

MDE for business ownership to compare any two groups in the study is 0.14 (at 0.9 power, alpha 0.05, control group mean at baseline 0.2). MDE for income from enterprise is USD 12, which is 50% of the baseline mean (at 0.9 power, alpha 0.05, control group mean at baseline 24 and SD 38.8)