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DOES MICROFINANCE EMPOWER WOMEN? Evidence from Self Help Groups in India

  • Bali Swain, Ranjula

    ()

    (Department of Economics)

  • Wallentin, Fan Yang

    ()

    (Department of Information Science, Statistics)

Microfinance programs like the Self Help Bank Linkage Program in India have been increasingly promoted for their positive economic impact and the belief that they empower women. However, only a few studies rigorously examine the link between microfinance and women’s empowerment. This paper contributes by arguing that women empowerment takes place when women challenge the existing social norms and culture, to effectively improve their well being. It empirically validates this hypothesis by using quasi-experimental household sample data collected for five states in India for 2000 and 2003. A general structural model is estimated by employing appropriate techniques to treat the ordinal variables in order to estimate the impact of the Self Help Group (SHG) on women empowerment for 2000 and 2003. The results strongly demonstrate that on average, there is a significant increase in the women empowerment of the SHG members group. No such significant change is observed however, for the members of the control group. The elegance of the result lies in the fact that the group of SHG participants show clear evidence of a significant and higher empowerment, while allowing for the possibility that some members might have been more empowered than others.

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File URL: http://uu.diva-portal.org/smash/get/diva2:39248/FULLTEXT01.pdf
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Paper provided by Uppsala University, Department of Economics in its series Working Paper Series with number 2007:24.

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Length: 26 pages
Date of creation: 24 Aug 2007
Date of revision:
Handle: RePEc:hhs:uunewp:2007_024
Contact details of provider: Postal: Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden
Phone: + 46 18 471 25 00
Fax: + 46 18 471 14 78
Web page: http://www.nek.uu.se/
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  1. M. Browning & P. A. Chiappori, 1998. "Efficient Intra-Household Allocations: A General Characterization and Empirical Tests," Econometrica, Econometric Society, vol. 66(6), pages 1241-1278, November.
  2. Nava Ashraf & Dean Karlan & Wesley Yin, 2006. "Female Empowerment: Impact of a Commitment Savings Product in the Philippines," Working Papers 949, Economic Growth Center, Yale University.
  3. Beatriz Armendariz & Jonathan Morduch, 2007. "The Economics of Microfinance," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262512017, June.
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