Does microfinance reduce poverty in Lao PDR?

Inpaeng Sayvaya and Phouphet Kyophilavong

International Journal of Development Issues, 2015, vol. 14, issue 3, 215-230

Abstract: Purpose - – The purpose of this study is to examine whether the village development fund (VDF) program reduces poverty in terms of income and expenditure. Design/methodology/approach - – The authors use cross-sectional data that are collected from 361 households in 15 villages in the rural district of Sukhuma of Champasak province in 2012 and use regression for analysis. Findings - – The estimate of the empirical model that is used for the econometric analysis is based on the model constructed by Coleman (1999). This study finds that VDF program has a positive impact on household income and expenditure but that the impact is statistically insignificant. Research limitations/implications - – The authors conclude that the VDF program has a minimal impact on poverty reduction in the study area. Practical implications - – Policy-maker should be aware that promotion of the VDF program might not reduce poverty in terms of income and expenditure. Social implications - – This finding might have significant impacts on poverty reduction strategy of Lao PDR. Originality/value - – It is the first study to investigate the impact of the VDF program on poverty in Lao PDR.

Keywords: Poverty; Village development funds (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijdipp:v:14:y:2015:i:3:p:215-230

DOI: 10.1108/IJDI-10-2014-0072

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