Out of the shadow: Encouraging online registration of micro and small businesses through a randomized controlled trial

Sarah Dong, Dewi Meisari and Banu Rinaldi

Departmental Working Papers from The Australian National University, Arndt-Corden Department of Economics

Abstract: This paper presents the findings of a large scale randomized controlled field trial that informs micro and small businesses about a free and easy to use online registration portal for business registration. We find that in the context of Indonesia, a country with a large informal sector and complicated business registration process, simple online registration can be attractive to micro and small businesses. Sending three rounds of short WhatsApp or text messages resulted in 3.4% of recipients clicking the registration link in the messages. Only 0.1% of recipients registered through the portal, however, indicating that the registration portal is not easy enough to use. Different phrasing of messages results in different click rate, different registration rate, and different rates the sender’s number is blocked. Neutral message performs the best, followed by message that emphasize that registration is easy. Message that appeals to people’s patriotic feelings or message that emphasize the registration is free performs the last, depending on the outcome.

Keywords: business registration; micro and small enterprises; informal sector; randomized controlled trial; behavioural insights (search for similar items in EconPapers)
JEL-codes: C93 O17 O29 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2021
New Economics Papers: this item is included in nep-dev, nep-exp, nep-iue, nep-pay and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:pas:papers:2021-05

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