Islam, Asadul (2010): Medium and Long-Term Participation in Microcredit: An Evaluation Using a New Panel Dataset from Bangladesh.
Download (229kB) | Preview
The objective of this paper is to estimate the impacts of medium- and long-term participation in microcredit programs. It utilises a new and large panel dataset collected from treatment and control households from 1997 to 2005. The data enables us to identify continuing participants in the program as well as newcomers and leavers. We employ different estimation strategies including triple-difference and propensity score matching methods to control for selection bias. The impact estimates indicate that the benefits from microcredit vary more than proportionately with the duration of participation in a program. Larger benefits are realized from longer-term participation, and that the benefits continue to accrue beyond departure from the program. The findings indicate the need to observe longer periods of participation to provide a reliable basis for assessing the effectiveness of microcredit lending.
|Item Type:||MPRA Paper|
|Original Title:||Medium and Long-Term Participation in Microcredit: An Evaluation Using a New Panel Dataset from Bangladesh|
|Keywords:||Microcredit, Bangladesh, fixed effects, triple-difference, matching, medium-term.|
|Subjects:||I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty > I31 - General Welfare, Well-Being
H - Public Economics > H4 - Publicly Provided Goods > H43 - Project Evaluation ; Social Discount Rate
C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C33 - Panel Data Models ; Spatio-temporal Models
C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C21 - Cross-Sectional Models ; Spatial Models ; Treatment Effect Models ; Quantile Regressions
G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages
|Depositing User:||Asadul Islam|
|Date Deposited:||13. Sep 2010 12:27|
|Last Modified:||23. Mar 2015 19:11|
Ahlin, C. and N. Jiang. 2008. "Can micro-credit bring development?" Journal of Development Economics, 86(1): 1-21. Alexander-Tedeschi, A. and D. Karlan. 2009 "Cross-sectional Impact Analysis: Bias from drop-outs." Perspectives on Global Development and Technology, microcredit special issue, forthcoming. Angrist, J. 1998. "Estimating the labor market impact of voluntary military service using social security data on military applicants." Econometrica , 6(2): 249-288. Banerjee, A., E. Duflo, R. Glennerster, and C. Kinnan. 2009. "The Miracle of microcredit? Evidence from a Randomized Evaluation," Working Paper, MIT. Bertrand, M., E. Duflo, and S. Mullainathan. 2004. "How much should we trust differences-in-differences estimates?" Quarterly Journal of Economics, 119(1): 249-75. Coleman, B. 1999. "The impact of group lending in Northeast Thailand." Journal of Development Economics, 60(1):105-41. Crump, R., J. Hotz, G. Imbens, and O. Mitnik. 2009. "Dealing with Limited Overlap in Estimation of Average Treatment Effects," Biometrika, 96(1):187-199 Dehejia, R. and S. Wahba. 1999. "Causal effects in nonexperimental studies: reevaluating the evaluation of training programs." Journal of the American Statistical Association, 94(448): 1053-62. Dehejia, R. and S. Wahba. 2002. "Propensity score matching methods for noexperimental causal studies." Review of Economics and Statistics, 84:151-61. de Mel, S., D. McKenzie, and C. Woodruff. 2008. "Returns to Capital: Results from a Randomized Experiment." Quarterly Journal of Economics, 123(4): 1329-72. de Mel, S., D. McKenzie, and C. Woodruff. 2009. "Are women more credit constrained? Experimental evidence on gender and microenterprise returns." American Economic Journal: Applied Economics, 1(3): 1--32. Falaris, E. 2003. "The effect of survey attrition in longitudinal surveys: evidence from Peru, Cote d'Ivoire, and Vietnam." Journal of Development Economics, 70:133-157. Fitzgerald, J., G. Peter, and R. Moffit. 1998. "An analysis of sample attrition in panel data: The Michigan panel study of income dynamics." Journal of Human Resources, 33(2):251-299. Heckman, J. and V. Hotz. 1989. "Choosing among alternative nonexperimental methods for estimating the impact of social programs: the case of manpower training." Journal of the American Statistical Association, 84(408): 862-74. Heckman, J., J. Smith, and C. Taber. 1998. "Accounting for dropouts in evaluations of social programs." Review of Economics and Statistics, 80(1): 1-14. Islam, A. 2008. "Who Benefits from microcredit? An impact evaluation of large scale programs in Bangladesh." Working Paper, Department of Economics, Monash University Islam, A. and P. Maitra. 2009. "Health shocks and consumption smoothing in rural households: Does microcredit have a role to play? Working Paper, Department of Economics, Monash University Kaboski J.and R.Townsend. 2009. "The Impact of credit on village economies." Working Paper, Department of Ecnomics, MIT. Kaboski J.and R.Townsend. 2005. "Policies and impact: An analysis of village-level microcredit institutions." Journal of the European Economic Association, 3(1): 1-50. Karlan, D. and J. Zinman. 2010. "Expanding credit access: Using randomized supply decisions to estimate the impacts." Review of Financial Studies, 23(1):433-464. Karlan, D. and J. Zinman. 2009."Expanding Microenterprise Credit Access: Using randomized supply decisions to estimate the impacts in Manila." Working Papers, Yale University Khandker, S. 2005. "microcredit and poverty: Evidence using panel data from Bangladesh." World Bank Economic Review, 19(2): 263-86. McKernan, S. 2002."The impact of microcredit programs on self-employment profits: Do noncredit program aspects matter?," Review of Economics and Statistics, 84(1):93-115, Morduch, J. 1998. "Does microcredit really help the poor? New evidence from flagship programs in Bangladesh." Working Paper, New York University. Pitt, M. and S. Khandker. 1998. "The Impact of group-based credit programs on poor households in Bangladesh: Does the gender of participation matter?" Journal of Political Economy, 106(5): 958-96. Ravallion, M., E. Galasso, T. Lazo, and E. Philipp. 2005. "What can ex-participants reveal about a program's impact?" Journal of Human Resources, 40(1): 208-30. Rosenbaum P. and D. Rubin 1983. "The central role of the propensity score in observational studies for causal effects." Biometrika, 70(1): 41-55. Thomas, D., E. Frankenberg, and J. Smith. 2001. "Lost but not forgotten: Attrition and follow-up in the Indonesia family life survey." Journal of Human Resources, 36(3):556-592. World Bank. 2007. "microcredit in South Asia: Toward financial inclusion for the poor." Washington D.C., December. Zhao, Z. 2006. "Matching estimators and the data from the national supported work demonstration again," IZA Discussion Paper.