Business and Financial Literacy for Young Entrepreneurs: Evidence from Bosnia-Herzogovina by Miriam Bruhn and Bilal Zia Discussant Comments Margaret Miller

Provides a strong environment for financial literacy intervention – best case scenario – Looks at a complete training program offered by a qualified instructor (good case) – NGO Entrepreneurship Development Center, faculty from Univ. of Tuzla, used interviews to adapt curriculum to needs of target population – High teacher – student ratio 1 to 6 or 1 to 10 – Monetary incentive – US$3 5 for participating, free transportation – Business loan clients in good standing (according to Partner’s definition) – Businesses with profits that are higher than GDP per capita, 5 years old, have one or more employees

Provides a strong environment for financial literacy intervention – best case scenario Motivated students Highly motivated – small group of 117 that actually took the training, 39% of sample that had indicated interest in training People who had been late on at least one payment were more interested Women were less interested Would like to have seen the paper address this potential selection bias more directly

Differential impacts by baseline financial literacy level People with below average levels of financial literacy had greater increases in knowledge measured on the survey People with above average levels of financial literacy to report higher profits, greater sales People in treatment group 22% less likely to mix personal and business accounts – regardless of financial literacy level

Questions going forward What resulted in the higher profits and sales? Is this a cost effective approach? How do you reach the populations that have less motivation, interest – Low levels of financial literacy – Women