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Aggregating Distributional Treatment Effects: A Bayesian Hierarchical Analysis of the Microcredit Literature

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  • Rachael Meager

Abstract

Expanding credit access in developing contexts could help some households while harming others. Microcredit studies show different effects at different quantiles of household profit, including some negative effects; yet these findings also differ across studies. I develop new Bayesian hierarchical models to aggregate the evidence on these distributional effects for mixture-type outcomes such as household profit. Applying them to microcredit, I find a precise zero effect from the fifth to seventy-fifth quantiles, and uncertain yet large effects on the upper tails, particularly for households with business experience. These quantile estimates are more reliable than averages because the data are fat tailed.

Suggested Citation

  • Rachael Meager, 2022. "Aggregating Distributional Treatment Effects: A Bayesian Hierarchical Analysis of the Microcredit Literature," American Economic Review, American Economic Association, vol. 112(6), pages 1818-1847, June.
    • Handle: RePEc:aea:aecrev:v:112:y:2022:i:6:p:1818-47
    DOI: 10.1257/aer.20181811
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    Citations

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    Cited by:

    1. Lori Beaman & Dean Karlan & Bram Thuysbaert & Christopher Udry, 2023. "Selection Into Credit Markets: Evidence From Agriculture in Mali," Econometrica, Econometric Society, vol. 91(5), pages 1595-1627, September.
    2. Gashaw T Abate & Alan de Brauw & John Gibson & Kalle Hirvonen & Abdulazize Wolle, 2022. "Telescoping Error in Recalled Food Consumption: Evidence from a Survey Experiment in Ethiopia [Video-Based Behavioral Change Communication to Change Consumption Patterns: Experimental Evidence from," The World Bank Economic Review, World Bank, vol. 36(4), pages 889-908.
    3. Konrad Menzel, 2023. "Transfer Estimates for Causal Effects across Heterogeneous Sites," Papers 2305.01435, arXiv.org, revised Feb 2024.
    4. Daniel Freund & Samuel B. Hopkins, 2023. "Towards Practical Robustness Auditing for Linear Regression," Papers 2307.16315, arXiv.org.
    5. Dagmara Celik Katreniak & Alexey Khazanov & Omer Moav & Zvika Neeman & Hosny Zoabi, 2023. "Why Not Borrow, Invest, and Escape Poverty?," Papers 2305.02546, arXiv.org.
    6. Campos, Francisco & Goldstein, Markus & McKenzie, David, 2023. "How should the government bring small firms into the formal system? Experimental evidence from Malawi," Journal of Development Economics, Elsevier, vol. 161(C).
    7. Haushofer, Johannes & Niehaus, Paul & Paramo, Carlos & Miguel, Edward & Walker, Michael W, 2022. "Targeting Impact Versus Deprivation," Department of Economics, Working Paper Series qt07j8n9vz, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    8. Bernardus F Nazar Van Doornik & Armando Gomes & David Schoenherr & Janis Skrastins, 2023. "Financial access and labor market outcomes: evidence from credit lotteries," BIS Working Papers 1071, Bank for International Settlements.

    More about this item

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • P34 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Finance

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