Wider impacts of microcredit: evidence from labor and human capital in urban Mexico
This paper presents an estimation of the impacts of microcredit on labor and human capital following a quasi-experiment specifically designed to control for endogeneity and selection bias in the context of urban Mexico. We find important indirect trickle-down effects of credit through labor expenditure that benefit poor laborers; however, these effects were only observed when loan-supported enterprising households reached a level of income well above the poverty line. We also find significant, although small impacts of credit on children´s schooling that could be potentially reinforced by improvements in lending technology, school grants and additional ex-ante preventive and ex-post protective riskcoping products.
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- Ljungqvist, Lars, 1993.
"Economic underdevelopment : The case of a missing market for human capital,"
Journal of Development Economics,
Elsevier, vol. 40(2), pages 219-239, April.
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