The Impact of Microcredit on the Poor in Bangladesh: Revisiting the Evidence

David Roodman and Jonathan Morduch

Journal of Development Studies, 2014, vol. 50, issue 4, 583-604

Abstract: We replicate and reanalyse the most influential study of microcredit impacts (M. M. Pitt & S. R. Khandker's, 'The impact of group-based credit on poor households in Bangladesh: Does the gender of participants matter?', published in the Journal of Political Economy, 106, 1998). That study was celebrated for showing that microcredit reduces poverty, a much hoped for possibility (though one not confirmed by recent randomised controlled trials). We show that the original results on poverty reduction disappear after dropping outliers, or when using a robust linear estimator. Using a new program for estimation of mixed process maximum likelihood models, we show how assumptions critical for the original analysis, such as error normality, are contradicted by the data. We conclude that questions about impact cannot be answered in these data.

Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (58)

Downloads: (external link)
http://hdl.handle.net/10.1080/00220388.2013.858122 (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: The Impact of Microcredit on the Poor in Bangladesh: Revisiting the Evidence (2009)
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:50:y:2014:i:4:p:583-604

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

DOI: 10.1080/00220388.2013.858122

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 ().