Poverty Targeting and Impact of a Governmental Micro-credit Program in Vietnam

Cuong Nguyen, Minh Thu Pham, Nguyet Pham Minh, Vu Thieu and Duong Toan

Working Papers PMMA from PEP-PMMA

Abstract: It is argued that without collateral the poor often face binding borrowing constraints in the formal credit market. This justifies a micro-credit program, which is operated by the Vietnam Bank for Social Policies to provide the poor with preferential credit. This paper examines poverty targeting and impact of the micro-credit program. It is found that the program is not very pro-poor in terms of targeting. Among the participants, the non-poor account for a larger proportion of loans. The non-poor also tend to receive larger amounts of credit compared to the poor. However, the program has positive impact on poverty reduction of the participants. This positive impact is found for all the three Foster-Greer-Thorbecke poverty measures.

Keywords: Micro-credit; poverty; poverty targeting; impact evaluation; instrumental variables; fixed-effect model (search for similar items in EconPapers)
JEL-codes: H43 H81 I32 I38 (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:lvl:pmmacr:2007-29

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