WORK IN PROGRESS

Inside the Production Function: The Effect of Financial Contracts on Growing Firms' Technology Use 
with Selim Gulesci Andreas Madestam and Francesco Loiacono, Mimeo, Stockholm University.

Randomized control trial in Uganda. AEA registry number: AEARCTR-0003062. 

We examine how key aspects of the most common form of financing-debt-may inhibit young firms' expansion. Starting a business entails learning and risk taking, implying that project returns to investment can start low but increase over time (in other words, be "backloaded") or be uncertain. Also, indivisible start-up costs often require large investments. Meanwhile, standard debt contracts available for micro-entrepreneurs from the formal or semi-formal financial sectors of many developing countries (such as microfinance) stipulate a constant repayment stream and caps on the initial loan size. The interaction of such features of the loan contract and the firm's production technology, may distort investment toward inputs that involve less learning, less uncertainty, and smaller projects; hampering firm growth. To shed light on the extent to which these theoretical mechanisms limit the effectiveness of micro-loans, we designed a randomized controlled trial where randomly chosen Ugandan firm owners, accepted for a loan, were offered amended contracts designed to alleviate one of these constraints. Treated firms, as well as a control group, are followed over a period of 5 years. The project will provide unique evidence on the constraints caused by the interaction of financial structure and technology use.

Using behavioral interventions to improve graduation rates in vocational education, with Naomi Gershoni. Randomized control trial in Israel, initiated in 2019. Data collection ongoing. AEARCTR-0007146

​We evaluate an intervention taking place within vocational colleges in Israel, which establishes a framework with monitored deadlines and reminders for delivery of the proposal and submission of the final project required to graduate with a diploma. The goal is to study whether this way of adding structure and reducing uncertainty about the submission date can improve student performance, with particular focus on the completion of the requirements for a diploma.

Performance based incentive payment for loan officers in Microfinance, with Erika Deserranno and Lame Ungwang. Randomized Field Experiment in Uganda, initiated in fall 2018. Fieldwork completed. Data collection ongoing. AEA registry number: AEARCTR-0004529. 

We study the effect of incentive schemes (bonuses) on the performance of credit officers working for a large microfinance institution. Specifically, we compare between a bonus scheme based on individual performance and a bonus scheme based on team performance. We use a randomized control methodology with randomization at the branch level, and ask how individual level as compared to team level bonus contracts affect loan quality, credit officer effort, the prevalence and intensity of team work, credit officer well-being and borrower pool characteristics.

Rotation policies for loan officers in Microfinance, with Erika Deserranno and Lame Ungwang. 

Randomized Field experiment in Uganda, initiated in fall 2018. Fieldwork completed. Data collection ongoing. AEA registry number: AEARCTR-0004891

The anatomy of Deliberative Decision making, with Vesall Nourani and Maya Duru.

The project uses data from lab in the field experiments in farmer groups in Malawi collected in 2013-16.

© 2018 by Miri Stryjan.

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