Information and Credit Constraints : Evidence from Horticultural Farmers in Rwanda

Business plan competitions can be a crucial factor to boost entrepreneurship through mitigating information and credit constraints, but the existing literature does not address that their impacts could go beyond intended beneficiaries. In this paper, I cover this aspect by studying the overall impact of a business plan competition among horticulture farmers in Rwanda on winners (endorsement effect) as well as on farmers who were rejected but implemented their business plans (implementation effect). I also evaluate whether the competition creates spillover effects on the SACCO. Using quasi-experimental techniques, results reveal that the competition has positive effects on household business outcomes and inputs, including horticulture income and hired labor. Although winning the competition increases the likelihood of securing funding, these positive impacts are mainly mediated through business plan implementation. The competition rewards also have positive impacts on SACCO membership, saving accounts and loans