Overcoming Selection Bias in Microcredit Impact Assessments: A Case Study in Peru

Gwendolyn Alexander Tedeschi

Journal of Development Studies, 2008, vol. 44, issue 4, 504-518

Abstract: There are several potential sources of bias in microcredit impact assessments. This paper uses a panel data set from a Peruvian MFI to test for impact of credit on microenterprise profits, while controlling for these biases. We find that those who will eventually become borrowers have significantly higher incomes than those who will not become borrowers, implying that selection into the lending programme is a substantial problem. After controlling for this selection, we find that an average microentrepreneur who borrows earns significantly higher enterprise profits than one who does not borrow, and that na�ve models, which do not control for selection, overestimate this impact. Fixed effects estimates give roughly the same results as the quasi-experimental cross-section analysis.

Date: 2008
References: View complete reference list from CitEc
Citations: View citations in EconPapers (25)

Downloads: (external link)
http://hdl.handle.net/10.1080/00220380801980822 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:jdevst:v:44:y:2008:i:4:p:504-518

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/FJDS20

DOI: 10.1080/00220380801980822

Access Statistics for this article

Journal of Development Studies is currently edited by Howard White, Oliver Morrissey and Ken Shadlen

More articles in Journal of Development Studies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().