The Miracle of Microfinance? Evidence from a Randomized Evaluation

Abhijit Banerjee, Esther Duflo, Rachel Glennerster and Cynthia Kinnan

American Economic Journal: Applied Economics, 2015, vol. 7, issue 1, 22-53

Abstract: This paper reports results from the randomized evaluation of a group-lending microcredit program in Hyderabad, India. A lender worked in 52 randomly selected neighborhoods, leading to an 8.4 percentage point increase in takeup of microcredit. Small business investment and profits of preexisting businesses increased, but consumption did not significantly increase. Durable goods expenditure increased, while "temptation goods" expenditure declined. We found no significant changes in health, education, or women's empowerment. Two years later, after control areas had gained access to microcredit but households in treatment area had borrowed for longer and in larger amounts, very few significant differences persist. (JEL G21, G31, O16, O12, L25, I38)

JEL-codes: G21 G31 I38 L25 O12 O16 (search for similar items in EconPapers)
Date: 2015
Note: DOI: 10.1257/app.20130533
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Citations: View citations in EconPapers (459)

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Related works:
Working Paper: The miracle of microfinance? Evidence from a randomized evaluation (2013)
Working Paper: The Miracle of Microfinance? Evidence from a Randomized Evaluation (2013)
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