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access to finance

The indictment is in, but what about that verdict?

Ryan Hahn's picture

Last month I wrote about the underwhelming results of a randomized control trial of microcredit in India. The long and short of it: access to credit helped increase business investment, but didn't have any noticeable effect on the things we really care about, like health and education. While it would perhaps be unfair to say that the study was a final verdict on microfinance, it was clearly a serious indictment.

The verdict is in on microfinance

Ryan Hahn's picture

And it's not pretty. The results from the first large-scale randomized trial of access to microfinance indicate that it comes up short in many areas of human development. 52 of 104 slums in Hyderabad were randomly selected to receive new branches of a microfinance outfit called Spandana. Abhijit Banerjee and the other randomistas from the Poverty Action Lab describe the results in The Miracle of Microfinance?

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