The Impact of Financial Education of Executives on Financial Practices of Medium and Large Enterprises
85 Pages Posted: 18 Sep 2019 Last revised: 2 Nov 2022
Date Written: October 31, 2022
We study the impact of an MBA-style executive education course in finance for top managers of medium and large enterprises on firm policies and performance through a randomized controlled trial (RCT) in Mozambique. We find that executives change firm financial policies in response to the treatment. A reduction in working capital generates an increase in cash that is used to finance long-term investments. Those changes improve the performance of the treated firms. Our experimental evidence shows that individual managers and their skills matter for firm behavior and economic performance.
Keywords: Financial Literacy, Financial Education, RCT, Financing Constraints, CEOs, Executives
JEL Classification: D4, G30, J24, L25, M41, O16
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