Microfinance and its Role in Household Poverty Reduction: Findings from Pakistan

Abstract

KatsusBrook ISBN : ersity of Ma @bcs.org.uk esponding ersity of Ba i@bath.ac.u ersity of Ma Kobe Unive shi.imai@m ks World Po : 978-1-907 anchester, k author ath, UK uk anchester, ersity, Japa manchester. overty Insti 7247-72-9 UK UK and an .ac.uk itute Micro A Is K J B Creat ofinance reduct Asad K. G ssam Ma Katsushi June 201 BWPI Wo ting and sh ww e and its tion: find Ghalib 1* alki 2 S. Imai 3 2 orking Pa haring know ww.manche role in h dings from 3 aper 173 wledge to h ester.ac.uk/ househol m Pakist help end po /bwpi ld povert tan overty ty Abstract This study examines whether household access to microfinance reduces poverty, and if so , to what ext ent and acros s which dim ensions of wellbe ing. T he st udy draws on f irst-hand observations and empirical dat a gathered from interviews of 1,132 households acro ss 11 dist ricts in t he rural areas of the province of Punjab in Pakistan. It employs a quasi-exp erimental research design and makes use of data collected b y int erviewing bot h borrower (t reatment) and non-borrower (control) ho useholds. Sample select ion biases are cont rolled b y ma tching propensity s cores. Findings reveal that al though borrowers seem to fare bett er than non-borrowers a cross around 70 percent of t he indicat ors, a majority o f these are n ot statistically significant. This suggest s that despite producing some degree of posit ive impact, microfinance inst itutions st ill have t o make s ustained efforts to bring about real difference to the livelihoods of the poor.

Impact of Microfinance on Women Empowerment in the Matrilineal Tribal Society of India: An Analysis Using Propensity Score Matching and Difference-in-Difference

“…Logit, Probit and Tobit are few such models. Here, the more popular model, logit is adopted, where, y (regressand) = 1/0, where '1' signifies the samples from the EG and '0' samples from the CG and x (regressor) = covariates (Chemin 2006;Deininger and Liu 2009a;Deininger and Liu 2009b;Ghalib et al 2012;Islam 2009;Love 2003;Mangala and Chengappa 2008;Owuor 2009;Setboonsarng and Parpiev 2008) where x 1 is age, x 2 educational qualification, x 3 employment status five years back, x 4 marital status, x 5 family type and x 6 is satisfaction levels five years back. These covariates form the profile of clients.…”

“…Despite the potency, microfinance suffers from the problem of poor outreach, accessibility and implementation. Sustained efforts are required to bring about real difference to the livelihoods of the poor (Ghalib et al 2012). Numerous studies show that it does not reach the core poor, its use is diverted to uneconomic activity and its contributions are negligible or negative (Sinha 2005).…”

“…Moreover, establishment of a sound-scientific base of matching and comparison between the groups is most important as it determines the acceptability of inferences. In this context, a recent improvement in impact analysis techniques in the field of development studies as seen in (Chemin 2006;Deininger and Liu 2009a;Deininger and Liu 2009b;Ghalib et al 2012;Islam 2009;Love 2003;Mangala and Chengappa 2008;Owuor 2009;and Setboonsarng and Parpiev 2008) is PSM and DinD.…”

TQM and Performance Linkage in the Microfinance Institutions: The Mediating Role of IT Capability

“…Studies related to welfarist school focus on the effect of microfinance on the poor people, imply that the effect on the poverty level of the borrowers as the performance of the MFIs. The measures used to reveal the impact of the MFIs on the poor people are the household income, expenditure on healthcare, clothing, water supply and building a quality of a dwelling house (Ghalib, Malki, & Imai, 2011). For the studies related to institutionalist school, the focus is mainly on the efficiency of MFIs to generate profit and to reach more the poor people.…”

Microcredit to Rural Women, Intra-household Power Play and Employment Creation in Northern Ghana

“…A plethora of studies in the extant literature have found that microcredit contributes positively to poverty reduction (Ghalib, Malki, & Imai, 2011; Gobezie & Garber, 2007; Imai & Azam, 2010; Imai, Arun, & Annim, 2010; Khandker, 2005). In a related study, it was found that household’s access to microfinance contributed to a long-lasting increase in income by means of increased households’ investments in income-generating activities and possible diversification of resources, accumulation of resources which smoothen household consumption.…”