Welcome to our Fall 2011 Newsletter!

USAID's new Development Innovation Ventures fund (DIV) recently awarded a grant to an IPA project intending to facilitate small business growth in Kenya.

Many Kenyan shops and kiosks purchase small quantities of non-perishable goods at high frequency for resale. These shopkeepers typically face challenges in obtaining trade credit, even though access to this type of credit could be essential to helping them expand their inventory and thus their businesses.

Led by researchers Tavneet Suri, William Jack, and Chris Woodruff and program partners, IPA's study will provide short-term trade credit to a sample of retail outlets, freeing up working capital for other short-term uses that could contribute to business growth. In collaboration with Financial Sector Deepening (FSD), Equity Bank’s in-house mobile banking platform will be used to execute loan transactions to Coca-Cola Bottling Company (CCBC) vendors. CCBC will build real-time payment monitoring directly into its central inventory management technology to provide a quicker response if and when borrowers fall behind on payments, making the product more viable for a larger number of retailers.

If proven successful by the evaluation, the partners are committed to expanding this project, with researchers noting that “the increasing availability of mobile payments systems makes scalability throughout and beyond Kenya feasible.”

Read the project summary here, and check out USAID’s blog post on the DIV award.

Governments and NGOs commonly try to change the political culture, civic values, and practices of conflict resolution at the local level through widespread dialogue, education, and information campaigns. Dialogue and education campaigns are at the core of Liberia’s present peace-building strategy, as many see the lack of equitable mechanisms for resolving local conflicts as root causes of past and future instability. But do these programs actually work as intended?

This study evaluated a program designed by UN’s Peacebuilding Commission and the Government of Liberia to promote non- violent dispute resolution and inter-group reconciliation. The randomized evaluation was conducted from 2009-2011 with a sample of 237 communities targeted within Liberia’s three most conflict-prone counties: Grand Geddeh, Lofa, and Nimba.

Analysis revealed that the most striking impacts were on conflict and its resolution, including: significant increases in non-violent inter-personal and inter-group disputes; suggestive evidence of a decrease in violent disputes; and increased rates of dispute resolution.

Click here to read the evaluation summary on our website, including detailed explanations of the intervention and of the results. You may also download a PDF policy report of the evaluation, or check out a second report on patterns of conflict in Liberia.

IPA’s SME Initiative recently hosted its Annual Conference on November 30 at the Inter-American Development Bank in Washington, DC. The conference provided an opportunity to present results from some of the most current research on Entrepreneurship and SME Development in emerging markets to a broad stakeholder group of researchers, practitioners and policymakers. It began with a brief presentation on “What we know about SMEs and Development.” This introduction was followed by three sessions focusing on Access to Managerial Human Capital, Access to Finance, and Job Creation. The conference concluded with a panel discussion entitled: Why should we care about the “Missing Middle”?

Presenters included:

• Antoinette Schoar, MIT-Sloan School of Management
• Dean Karlan, Yale University
• Nick Bloom, Stanford University
• David McKenzie, World Bank
• Philipp Schnabl, NYU-Stern School of Business
• Chris Woodruff, Warwick University

The conference agenda is available here and presentations will be made available on the website shortly.