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Microfinance and Household Poverty Reduction: Empirical Evidence from Rural Pakistan

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  • Asad K. Ghalib
  • Issam Malki
  • Katsushi S. Imai

Abstract

This study examines whether household access to microfinance reduces poverty in Pakistan and, if so, how and to what extent. It draws on primary empirical data gathered by interviewing 1132 households, including both borrower and non-borrower households, in 2008-2009. Sample selection biases have been partially controlled for by using propensity score matching. The study reveals that microfinance programmes had a positive impact on the participating households. Poverty-reducing effects were observed on a number of indicators, including expenditure on healthcare, clothing and household income, and on certain dwelling characteristics, such as water supply and the quality of roofing and walls.

Suggested Citation

  • Asad K. Ghalib & Issam Malki & Katsushi S. Imai, 2015. "Microfinance and Household Poverty Reduction: Empirical Evidence from Rural Pakistan," Oxford Development Studies, Taylor & Francis Journals, vol. 43(1), pages 84-104, March.
    • Handle: RePEc:taf:oxdevs:v:43:y:2015:i:1:p:84-104
    DOI: 10.1080/13600818.2014.980228
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    5. Robert A. Moffitt, 1996. "Selection Bias Adjustment in Treatment-Effect Models as a Method of Aggregation," NBER Technical Working Papers 0187, National Bureau of Economic Research, Inc.
    6. International Monetary Fund, 2010. "Pakistan: Poverty Reduction Strategy Paper," IMF Staff Country Reports 2010/183, International Monetary Fund.
    7. World Bank, 2002. "Poverty Assessment : Poverty in Pakistan - Vulnerabilities, Social Caps, and Rural Dynamics," World Bank Publications - Reports 15335, The World Bank Group.
    8. Todd, Petra E., 2008. "Evaluating Social Programs with Endogenous Program Placement and Selection of the Treated," Handbook of Development Economics, in: T. Paul Schultz & John A. Strauss (ed.), Handbook of Development Economics, edition 1, volume 4, chapter 60, pages 3847-3894, Elsevier.
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    2. Stylianou Tasos & Muhammad Ijaz Amjad & Masood Sarwar Awan & Muhammad Waqas, 2020. "Poverty Alleviation and Microfinance for the Economy of Pakistan: A Case Study of Khushhali Bank in Sargodha," Economies, MDPI, vol. 8(3), pages 1-18, August.
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