Answers inserted between your questions below:
Why do we have to assume that the negative spillovers WITHIN the within-village sample apply more broadly?
BO: We don't have to assume that. We simply don't know.
If we don't have to assume that -
a. what is the best PLAUSIBLE guess as to what happened to those households that (may have) experienced spillovers?
BO: I don't know. But, for one example, you could imagine that poor people are engaged in similar small enterprises in these villages and removing the credit constraint to some allows them to enter the market (and perhaps even grow a bit), but at the cost of losses to existing enterprises.
b. is there available data on what happened to the other households WITHIN the village, who were neither the a) treatment group, b) spillover group?
BO: Not in this study. Some studies do this, some don't. I'll have a post on this tomorrow...
Thank you, again.BO: No problem,