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Does Microcredit Reach the Poor and Vulnerable? Evidence from Northern Bangladesh

Author

Listed:
  • Sajeda Amin
  • Ashok S. Rai
  • Giorgio Topa

Abstract

This paper evaluates whether microcredit programs such as the popular Grameen Bank reach the relatively poor and vulnerable in two Bangladeshi villages. It uses a unique panel dataset with monthly consumption and income data for 229 households before they received loans. We find that while microcredit is successful at reaching the poor, it is less successful at reaching the vulnerable, and may even exclude the vulnerable poor.

Suggested Citation

  • Sajeda Amin & Ashok S. Rai & Giorgio Topa, 2001. "Does Microcredit Reach the Poor and Vulnerable? Evidence from Northern Bangladesh," CID Working Papers 28A, Center for International Development at Harvard University.
  • Handle: RePEc:cid:wpfacu:28a
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    References listed on IDEAS

    as
    1. Martin Ravallion & Gaurav Datt, 1995. "Is Targeting Through a Work Requirement Efficient? Some Evidence for Rural India," Monash Economics Working Papers archive-41, Monash University, Department of Economics.
    2. Jalan, Jyotsna & Ravallion, Martin, 1999. "Are the poor less well insured? Evidence on vulnerability to income risk in rural China," Journal of Development Economics, Elsevier, vol. 58(1), pages 61-81, February.
    3. Townsend, Robert M, 1994. "Risk and Insurance in Village India," Econometrica, Econometric Society, vol. 62(3), pages 539-591, May.
    4. repec:pri:rpdevs:morduch_microfinance_poor is not listed on IDEAS
    5. Jonathan Morduch, 1999. "The Microfinance Promise," Journal of Economic Literature, American Economic Association, vol. 37(4), pages 1569-1614, December.
    6. Navajas, Sergio & Schreiner, Mark & Meyer, Richard L. & Gonzalez-vega, Claudio & Rodriguez-meza, Jorge, 2000. "Microcredit and the Poorest of the Poor: Theory and Evidence from Bolivia," World Development, Elsevier, vol. 28(2), pages 333-346, February.
    7. 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.
    8. Anderson, Gordon, 1996. "Nonparametric Tests of Stochastic Dominance in Income Distributions," Econometrica, Econometric Society, vol. 64(5), pages 1183-1193, September.
    9. Quentin Wodon, 1997. "Food energy intake and cost of basic needs: Measuring poverty in Bangladesh," Journal of Development Studies, Taylor & Francis Journals, vol. 34(2), pages 66-101.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    poverty; vulnerability; microcredit; targeting; Grameen Bank;

    JEL classification:

    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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