## **F Subjective Well-Being**

Before turning to mechanisms of impact, we present results on two measures of subjective wellbeing. Indeed, improvements in sales and profits do not necessarily imply greater satisfaction as they may have incurred other subjective costs. To address this concern, we included two endline questions from the World Values Survey to elicit subjective well-being: (1) “How satisfied are you with the financial situation of your household?” and (2) “How satisfied are you with your life at this point?” (see, Inglehart et al., 2014).<sup>23</sup> Table 10 shows results from regressing these two measures of subjective-wellbeing on treatment assignment. While we do not detect significant treatment effects for satisfaction with life, the results show a positive and statistically significant effect of being assigned to _All Three_ on satisfaction with finances. Specifically, these shop owners are 4.5 percentage points (7.1%) more satisfied with their finances than those assigned to the control group. Shop owners assigned to other groups show a slight increase in both measures of well-being, but the effects are not statistically significant.

# **V Mechanisms**

We now turn to the mechanisms behind the increase in sales and profits identified in the previous section. The experiment design of this paper implies a strong causal link between improved business practices and better performance outcomes. This link is especially merited given the handbook and its accompanying experiential learning add-ons are precisely based on the business practices for which we identify treatment effects. In this section, we delve more deeply into the details of these practices and how they relate to gains in efficiency rather than other mechanisms. We also study possible alternative explanations for the performance improvement.

## **A Efficiency Gains or Just Better Record-Keeping?**

In this subsection, we unpack the individual practices underlying the aggregate indices to shed light on the mechanisms of impact. This exercise also helps address the concern that the performance gains we identify are simply the result of shop owners being able to record sales and profits better without any real improvements in the business.

First, while record-keeping practices do improve as a result of treatment, it is important to note that shop owners improve other key handbook practices as well. In particular, they adopt practices that are bound to make the business more efficient. For instance, businesses assigned to _All Three_ “adjust stocks based on product profitability” and “negotiate lower prices with suppliers” (Appendix Table A3c); “consult with former customers” and “offer discounts” (Appendix Table A3d); “make joint decisions” and “draft agreements to make joint decisions” with a business partner (Appendix Table A3e). These practices are expected to either lower average unit cost of the shop owner (vis-a-vis suppliers) or lower frictions when reaching customers and improve business efficiency. Additionally, we observe a substantial positive impact on practices related to financial planning (Appendix Table A3b), such as “reviewing financial performance to identify channels of improvement”, “making anticipated budget for upcoming costs” and “comparing target vs actual sales”. Combined, these

> 23Respondents were instructed to answer on a scale from 1 to 10, where 1 indicates “very dissatisfied” and 10 indicates “very satisfied”.

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