Household welfare effects of ROSCAs

Pushkar Maitra, Ray Miller and Ashish Sedai

World Development, 2023, vol. 169, issue C

Abstract: We examine the effects of Rotating Savings and Credit Associations (ROSCAs) on household welfare in India. The identification strategy is based on household fixed effects and instrumental variables (using the geographic leave-one-out instrument). We find that ROSCA membership increases household assets, consumption, energy efficiency and school expenditure, but only in rural areas. Welfare effects are stronger for poorer households and for those living in communities with stronger social ties. We argue that the persistence and success of ROSCAs depends on social ties, which are often stronger in rural communities.

Keywords: ROSCA; Household welfare; Community bonding; O12; C26; C33 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:169:y:2023:i:c:s0305750x23001055

DOI: 10.1016/j.worlddev.2023.106287

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