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Microfinance at the margin: experimental evidence from Bosnia and Herzegovina
[working paper]
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Wissenschaftszentrum Berlin für Sozialforschung gGmbH
Abstract We use a randomised controlled trial (RCT) to analyse the impact of microcredit on poverty reduction in Bosnia and Herzegovina. The study population are loan applicants that would normally have just been rejected based on regular screening. We find that access to credit allowed borrowers to start an... view more
We use a randomised controlled trial (RCT) to analyse the impact of microcredit on poverty reduction in Bosnia and Herzegovina. The study population are loan applicants that would normally have just been rejected based on regular screening. We find that access to credit allowed borrowers to start and expand small-scale businesses. Households that already had a business and where the borrower had more education, ran down their savings, presumably to complement the loan and to achieve the minimum amount necessary to expand their business. In less-educated households, however, consumption went down. A key new result is that there was a substantial increase in the labour supply of young adults (16-19 year olds). This was accompanied by a reduction in school attendance. (author's abstract)... view less
Keywords
microfinance; human capital; liquidity; credit; combating poverty; level of education; school attendance; available workers; setting up a business; Bosnia and Herzegovina
Classification
Economic Policy
Social Problems
Document language
English
Publication Year
2014
City
Berlin
Page/Pages
40 p.
Series
Discussion Papers / Wissenschaftszentrum Berlin für Sozialforschung, Forschungsschwerpunkt Markt und Entscheidung, Abteilung Ökonomik des Wandels, SP II 2014-304
Handle
https://hdl.handle.net/10419/93061
Status
Published Version; reviewed
Licence
Deposit Licence - No Redistribution, No Modifications