Access to credit has become a staple of modern development policy as a means to facilitate anything from gender equality to growth. In economic terms, it provides an important tool for smoothing household consumption in the wake of unexpected economic shocks, including drought and financial crises. Using data from the Indonesian Family Life Survey (1993-2000), this paper investigates whether access to microfinance institutions affects child health outcomes. Evidence from difference-indifferences regressions with endogenous regressors shows that the entrance of microfinance institutions into communities previously lacking such access significantly increases the average weight gain of young children.
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Paper provided by Elon University, Department of Economics in its series Working Papers with number
2009-02.