Lack of skills is arguably one of the most important determinants of high levels of unemployment and poverty. In response, policymakers often initiate vocational training programs in effort to enhance skill formation among the youth. Using a regression-discontinuity design, we are among the first to examine a large youth training intervention in a low-income country: Nepal. We find, twelve months after the start of the training program, that the intervention generated an increase in non-farm employment of 10 percentage points (ITT estimates) and up to 31 percentage points for program compliers (LATE estimates). We also detect sizeable gains in monthly earnings. Women who start self-employment activities inside their homes largely drive these impacts. We argue that low baseline educational and non-farm employment levels and Nepal’s social and cultural norms towards women drive our large program impacts.

Keywords: Human Capital, (Self-)Employment, Youth, Female Economic Empowerment, Regression Discontinuity, Nepal.