This paper examines whether psychological empowerment can mitigate mental constraints
that impede efforts to overcome the effects of social exclusion. Using a randomized control
trial, we study a training program specifically designed to reduce stigma and build self-efficacy
among poor and marginalized sex workers in Kolkata, India. We find positive and
significant impacts of the training on self-reported measures of efficacy, happiness and self-esteem
in the treatment group, both relative to the control group as well as baseline measures.
We also find higher effort towards improving future outcomes as measured by the
participants’ savings choices and health-seeking behaviour, relative to the control group.
These findings highlight the need to account for psychological factors in the design of antipoverty
programmes
