The worlds poorest people lack both capital and skills and are trapped in low return occupations. Whether their economic lives can be transformed by programmes which attempt to tackle both constraints by providing assets and training to enable them to run small businesses is however unknown. To shed light on this issue we conduct a randomized evaluation of an entrepreneurship programme that provides assets and training to the poorest women in rural Bangladesh. We find that the programme transforms the occupational choices of the poor women who participated in the programme by inducing them to spend more time in self-employment, less in wage labour and increases their labour market participation, leading to a 36% increase in annual income on average. Moreover, the programme leads to an increase in wages at the village level and its effects spillover to other poor women who experience an increase in labour supply and income.
Key words: Entrepreneurship, poverty, asset transfer, skills, training, general equilibrium, spill-overs.