IDEAS home Printed from https://ideas.repec.org/a/pal/eurjdr/v34y2022i3d10.1057_s41287-021-00425-w.html
   My bibliography  Save this article

The Effects of Microfinance Programs on Recipients’ Livelihoods in Rural Bangladesh

Author

Listed:
  • Mohummed Shofi Ullah Mazumder

    (Sher-e-Bangla Agricultural University)

Abstract

Despite the widespread use of microfinance programs since the early 1990s, there is little empirical research on the effects of microfinance on recipients’ livelihoods in rural areas. We therefore compared the effects of governmental and non-governmental microfinance on livelihood and empowerment in rural Bangladesh. Data were collected in two phases from the same 300 microfinance beneficiaries and 200 control respondents using face-to-face interviews. Both descriptive and inferential statistics (propensity score matching, Rosenbaum bounds, and ordinary least squares) were used for analysis. Fixed effects instrumental variable estimates were also designed to minimize spillover effects. Microfinance significantly contributed to different livelihood and empowerment dimensions to ultimately improve livelihoods, with the greatest improvements seen in non-governmental rather than governmental microfinance recipients.

Suggested Citation

  • Mohummed Shofi Ullah Mazumder, 2022. "The Effects of Microfinance Programs on Recipients’ Livelihoods in Rural Bangladesh," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(3), pages 1383-1418, June.
    • Handle: RePEc:pal:eurjdr:v:34:y:2022:i:3:d:10.1057_s41287-021-00425-w
    DOI: 10.1057/s41287-021-00425-w
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1057/s41287-021-00425-w
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1057/s41287-021-00425-w?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Khandker, S.R. & Khalily, B. & Khan, Z., 1995. "Grameen Bank: Performance and Sustainability," World Bank - Discussion Papers 306, World Bank.
    2. Joseph Kimos Adjei & Thankom Arun & Farhad Hossain, 2009. "The Role of Microfinance in Asset-Building and Poverty Reduction: The Case of Sinapi Aba Trust of Ghana," Global Development Institute Working Paper Series 8709, GDI, The University of Manchester.
    3. Nava Ashraf & Xavier Giné & Dean Karlan, 2009. "Finding Missing Markets (and a Disturbing Epilogue): Evidence from an Export Crop Adoption and Marketing Intervention in Kenya," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(4), pages 973-990.
    4. J.J. Heckman & E.E. Leamer (ed.), 2007. "Handbook of Econometrics," Handbook of Econometrics, Elsevier, edition 1, volume 6, number 6b.
    5. Mohammad Monirul Hasan & Mohammad Abdul Malek, 2017. "Microfinance Market in Bangladesh," World Scientific Book Chapters, in: Microfinance in Asia, chapter 8, pages 271-306, World Scientific Publishing Co. Pte. Ltd..
    6. Rosenbaum, Paul R., 2005. "Heterogeneity and Causality: Unit Heterogeneity and Design Sensitivity in Observational Studies," The American Statistician, American Statistical Association, vol. 59, pages 147-152, May.
    7. Ranjula Bali Swain & Fan Yang Wallentin, 2009. "Does microfinance empower women? Evidence from self-help groups in India," International Review of Applied Economics, Taylor & Francis Journals, vol. 23(5), pages 541-556.
    8. Mark M. Pitt & Shahidur R. Khandker, 1998. "The Impact of Group-Based Credit Programs on Poor Households in Bangladesh: Does the Gender of Participants Matter?," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 958-996, October.
    9. J.J. Heckman & E.E. Leamer (ed.), 2007. "Handbook of Econometrics," Handbook of Econometrics, Elsevier, edition 1, volume 6, number 6a.
    10. Yogendra Shakya & Katharine Rankin, 2008. "The Politics of Subversion in Development Practice: An Exploration of Microfinance in Nepal and Vietnam," Journal of Development Studies, Taylor & Francis Journals, vol. 44(8), pages 1214-1235.
    11. Hulme, David, 2000. "Impact Assessment Methodologies for Microfinance: Theory, Experience and Better Practice," World Development, Elsevier, vol. 28(1), pages 79-98, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Do Xuan Luan & Nguyen Thanh Vu & Kieu Thi Thu Huong & Duong Hang & Siegfried Bauer, 2016. "Is Access to Agribank Credit an Effective Tool in Improving Household Income? Evidence from the Northern Mountainous Region of Vietnam," Asian Social Science, Canadian Center of Science and Education, vol. 12(8), pages 110-110, August.
    2. Ismaël Mourifié & Marc Henry & Romuald Méango, 2020. "Sharp Bounds and Testability of a Roy Model of STEM Major Choices," Journal of Political Economy, University of Chicago Press, vol. 128(8), pages 3220-3283.
    3. Ali Palali & Jan C. Van ours, 2017. "Love Conquers all but Nicotine: Spousal Peer Effects on the Decision to Quit Smoking," Health Economics, John Wiley & Sons, Ltd., vol. 26(12), pages 1710-1727, December.
    4. Hu Yingyao & Shum Matthew & Tan Wei & Xiao Ruli, 2017. "A Simple Estimator for Dynamic Models with Serially Correlated Unobservables," Journal of Econometric Methods, De Gruyter, vol. 6(1), pages 1-16, January.
    5. James J. Heckman, 2008. "Econometric Causality," International Statistical Review, International Statistical Institute, vol. 76(1), pages 1-27, April.
    6. Michel Mouchart & Renzo Orsi, 2016. "Building a Structural Model: Parameterization and Structurality," Econometrics, MDPI, vol. 4(2), pages 1-16, April.
    7. Jaap H. Abbring & Tim Salimans, 2019. "The Likelihood of Mixed Hitting Times," Papers 1905.03463, arXiv.org, revised Apr 2021.
    8. Sokbae Lee & Bernard Salanié, 2018. "Identifying Effects of Multivalued Treatments," Econometrica, Econometric Society, vol. 86(6), pages 1939-1963, November.
    9. Rao, Smriti, 2008. "Reforms with a Female Face: Gender, Liberalization, and Economic Policy in Andhra Pradesh, India," World Development, Elsevier, vol. 36(7), pages 1213-1232, July.
    10. Prabirendra Chatterjee & Sudipta, Sarangi, "undated". "Social Identity and Group Lending," Working Papers UWEC-2005-06-R, University of Washington, Department of Economics.
    11. Marmer, Vadim & Shneyerov, Artyom, 2012. "Quantile-based nonparametric inference for first-price auctions," Journal of Econometrics, Elsevier, vol. 167(2), pages 345-357.
    12. Olivier Brossard & Stéphanie Lavigne & Mustafa Erdem Sakinç, 2013. "Ownership structures and R&D in Europe: the good institutional investors, the bad and ugly impatient shareholders," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 22(4), pages 1031-1068, August.
    13. Robert A. Moffitt & Matthew V. Zahn, 2019. "The Marginal Labor Supply Disincentives of Welfare: Evidence from Administrative Barriers to Participation," NBER Working Papers 26028, National Bureau of Economic Research, Inc.
    14. Gutiérrez-Nieto, Begoña & Serrano-Cinca, Carlos, 2019. "20 years of research in microfinance: An information management approach," International Journal of Information Management, Elsevier, vol. 47(C), pages 183-197.
    15. Palali, Ali & van Ours, Jan, 2015. "Love Conquers All but Nicotine : Spousal Peer Effects on the Decision to Quit Smoking," Discussion Paper 2015-048, Tilburg University, Center for Economic Research.
    16. Siddhartha Bandyopadhyay & Sanjukta Sarkar & Rudra Sensarma, 2021. "Does Access to Key Household Resources Help in Reducing Violence against Women?," Discussion Papers 21-09, Department of Economics, University of Birmingham.
    17. Giovanni Cespa & Xavier Vives, 2011. "Expectations, Liquidity, and Short-term Trading," CESifo Working Paper Series 3390, CESifo.
    18. Nakano, Yuko & Magezi, Eustadius F., 2020. "The impact of microcredit on agricultural technology adoption and productivity: Evidence from randomized control trial in Tanzania," World Development, Elsevier, vol. 133(C).
    19. Gregory De & Marina Toger & Sarit Weisburd, 2023. "Police Response Time and Injury Outcomes," The Economic Journal, Royal Economic Society, vol. 133(654), pages 2147-2177.
    20. Kaiser, Ulrich & Mendez, Susan J. & Rønde, Thomas & Ullrich, Hannes, 2014. "Regulation of pharmaceutical prices: Evidence from a reference price reform in Denmark," Journal of Health Economics, Elsevier, vol. 36(C), pages 174-187.

    More about this item

    Keywords

    Microfinance; Rural livelihood and empowerment; Fixed effects instrumental variables (FE-IV); Propensity score matching (PSM); Rosenbaum bounds;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • H81 - Public Economics - - Miscellaneous Issues - - - Governmental Loans; Loan Guarantees; Credits; Grants; Bailouts
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:eurjdr:v:34:y:2022:i:3:d:10.1057_s41287-021-00425-w. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.