Microfinance and poverty - evidence using panel data from Bangladesh
AbstractMicro-finance supports mainly informal activities that often have low market demand. It may be thus hypothesized that the aggregate poverty impact of micro-finance in an economy with low economic growth is modest or nonexistent. The observed borrower-level poverty impact is then a result of income redistribution or short-run income generation. The author addresses these questions using household level panel data from Bangladesh. The findings confirm that micro-finance benefits the poorest and has sustained impact in reducing poverty among program participants. It also has positive spillover impact, reducing poverty at the village level. But the effect is more pronounced in reducing extreme rather than moderate poverty.
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Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 2945.
Date of creation: 31 Jan 2003
Date of revision:
Environmental Economics&Policies; Banks&Banking Reform; Financial Intermediation; Payment Systems&Infrastructure; Poverty Monitoring&Analysis; Environmental Economics&Policies; Banks&Banking Reform; Poverty Monitoring&Analysis; Financial Intermediation; Poverty Assessment;
Other versions of this item:
- Shahidur R. Khandker, 2005. "Microfinance and Poverty: Evidence Using Panel Data from Bangladesh," World Bank Economic Review, World Bank Group, vol. 19(2), pages 263-286.
- NEP-ALL-2004-08-16 (All new papers)
- NEP-DEV-2004-08-16 (Development)
- NEP-MFD-2004-09-12 (Microfinance)
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