Does Microfinance Reduce Poverty in Bangladesh? New Evidence from Household Panel Data

Katsushi S. Imai*, Md Shafiul Azam

*Corresponding author for this work

Research output: Contribution to journalSpecial issuepeer-review

120 Citations (SciVal)

Abstract

The study examines whether loans from microfinance institutions (MFI) reduce poverty in Bangladesh drawing upon the nationally representative household panel with four rounds from 1997 to 2004. The effects of general microfinance loans and loans for productive purposes on income, food consumption and women's Body Mass Index are estimated. Overall effects of MFI loans on income and food consumption were positive and the purpose of the loan is important in predicting which household welfare indicator is improved. Alternative estimation methods confirm a positive impact of MFI loans on food consumption growth, which supports the poverty reducing effects of microfinance in Bangladesh.

Original languageEnglish
Pages (from-to)633-653
Number of pages21
JournalJournal of Development Studies
Volume48
Issue number5
DOIs
Publication statusPublished - 2012

Keywords

  • CAUSAL
  • PROPENSITY SCORE

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