firm-level data, the program was found to have increased the sales and ability to export of large buyer firms since two years after the enrollment to the program (Arráiz, et al., 2013).

The little experimental evidence that exists on pure subsidy on inputs or rationing of inputs as instruments for improving access to intermediate inputs do not seem to have enhanced firm performance. In fact, in Ghana electricity rationing led to significant productivity losses (Abeberese et al., 2017).<sup>13</sup> Improved access to electronic and digital services could also boost firm performance, but there are large gaps in realizing the potential benefits. For example, in developing countries, small trading activities are generally based on self-employment, and retail firms could spend substantial time and costs on sourcing from wholesale market. In a field experiment in Bogota, retailers were randomly provided an electronic centralized distribution service to aggregate orders. These orders were then delivered to them directly from farmers. The services decreased the time and the costs of travel, as well as the purchase prices of the targeted products for the treated retailers. In fact, there were also spillover effects in the sense that untreated firms in treated blocks also reduced their prices of the same products. Nevertheless, treated retailers saw a decline in total sales because of a drop in sales from other products (Iacovone and McKenzie, 2019).<sup>14</sup> This evidence suggests that even though more efficient service delivery model is desirable, it takes more than partial adoption to make it successful. More exploration is needed to understand the larger scale effects of improved access to intermediate digital services, especially in the context of COVID-19.

# **3.4.Interventions improving firm capabilities**<sup>**15**</sup>

There is huge heterogeneity in business training programs, because the content of training program and the selection of participants, relative to other firm interventions (e.g. finance programs), vary largely across different training interventions.<sup>16</sup> Therefore, comparison of evidence on the effectiveness of firm training programs should also consider “who” participates in the program, as well as “what” type of training is offered and “how” the training is delivered. With these caveats in mind, an excellent survey by McKenzie and Woodruff (2014) find that in general, business training programs have weak positive effects on survivorship of existing male-owned firms, negative or no effect on female-led ones. They have slightly stronger effects on new business start-ups, but it merely hastens entry of firms that would have entered anyway. While training programs improved the implementation of some of the business practices learned

> 13 There could be social benefits of electrification though because it operates as a labor-saving technology shock to home production. In rural communities in South Africa, electrification has led to an increase in female labor supply (Dinkelman, 2011). 14 Consequently, the usage of this service decreased over time so that the provider of electronic service was forced to shut down. 15 There is not much evidence on instruments for enhancing firm capabilities relating to technology adoption and innovation, especially from African countries. See Cirera et al. (2020) for extensive evidence on these instruments. 16 McKenzie and Woodruff (2014) summarize the effectiveness of business training programs across 16 evaluation studies, four of which are from Sub-Saharan Africa. In general, very few studies evaluate the effectiveness of business training programs in SubSaharan Africa.

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