Poverty Status and the Impact of Formal Credit on Technology Use and Wellbeing among Ethiopian Smallholders

Lenis Liverpool-Tasie and Alex Winter-Nelson

World Development, 2010, vol. 38, issue 4, 541-554

Abstract: Summary This paper examines the impact of formal credit (largely microfinance) on the use of improved technology and on consumption and asset growth across households in different degrees of asset poverty. Using data from rural Ethiopia, the analysis finds no relationship between participation in microfinance programs and the use of technologies or consumption growth among the poorest households even though the use of certain technologies, like fertilizer, contributes to their asset accumulation over time. For other households, microfinance has positive effects on both consumption and asset growth as well as on the use of improved technology. The findings imply variation in constraints faced by different classes of poor households and suggest the value of asset-based poverty classifications in identifying target groups for poverty interventions.

Keywords: Africa; Ethiopia; fertilizer; microfinance; poverty (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (23)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:38:y:2010:i:4:p:541-554

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