Working Paper: NBER ID: w22674
Authors: Francisco J. Buera; Joseph P. Kaboski; Yongseok Shin
Abstract: We review the empirical evidence on microfinance and asset grants to the ultra poor or microentrepreneurs, and assess our ability to account for this evidence using quantitative theory. Properly executed, these interventions can help segments of the population increase their income and consumption, but neither the empirical micro nor quantitative macro literatures give much reason to believe that such interventions can lead to wide-scale, transformative impacts akin to escaping aggregate poverty traps.
Keywords: microfinance; asset grants; poverty alleviation; entrepreneurship
JEL Codes: O1; O11; O12; O16
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| microfinancial interventions (O12) | short-term benefits (J32) |
| microfinancial interventions (O12) | lack of large-scale transformative changes (P39) |
| initial wealth, gender, entrepreneurial ability (L26) | impacts of interventions (I24) |
| microcredit programs (O12) | increase in income (E25) |
| microcredit programs (O12) | increase in consumption (E21) |
| asset grants (H82) | increase in income (E25) |
| asset grants (H82) | increase in consumption (E21) |
| asset grants (H82) | higher capital levels (G32) |
| microcredit (O12) | increase entrepreneurial activity (L26) |
| microcredit (O12) | no significant impact on overall income (F69) |
| microcredit (O12) | no significant impact on overall consumption (F61) |