Original abstracts from the papers in the database are provided below. All abstracts are drawn directly from the papers referenced. Links to access the papers are provided, although
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Feigenberg et al. (2011)
Microfinance clients were randomly assigned to repayment groups that met ei- ther weekly or monthly during their first loan cycle, and then graduated to identical meeting frequency for their second loan. Long-run survey data and a follow-up pub- lic goods experiment reveal that clients initially assigned to weekly groups interact more often and exhibit a higher willingness to pool risk with group members from their first loan cycle nearly two years after the experiment. They were also three times less likely to default on their second loan. Evidence from an additional treat- ment arm show that, holding meeting frequency fixed, the pattern is insensitive to repayment frequency during the first loan cycle. Taken together, these findings con- stitute the first experimental evidence on the economic returns to social interaction, and provide an alternative explanation for the success of the group lending model in reducing default risk.
Intervention settings: Urban and peri-urban.
Intervention description: Individual liability loans. Tested the impact of meeting frequency and social interaction on repayment rates of individual-liability loans.
Sample: First time microfinance bank clients living in peri-urban slums in the city of Kolkata. Over 70% owned a business and median client's HH income just below a dollar a day. 100% women.
Findings: In the absence of group liability and enforcement, more frequent group meetings led to greater social interaction and reduced default rates.
Recent studies have shown that the majority of the poor lack access to formal banking services of any kind (Banerjee and Duflo (2007), Collins et al. (2009)) and have emphasized the importance of enabling savings. A simple savings account was randomly offered to poor female household heads through local bank-branches in 17 slums in Nepal. 81% of the individuals offered the account took it up and 78% used it actively. Account holders made on average one deposit per week, saving about 9% of their weekly income and, within the first four months of opening the account made one withdrawal half the size of their weekly income. Access to the savings account increased monetary assets by 40% without causing any crowding out in other kind of assets. If anything, being offered the account had a positive and significant impact on ROSCA's contributions and overall value of animal stock.
Intervention settings: Peri-urban: Pokhara.
Intervention description: Flexible savings accounts were provided with no opening, deposit or withdrawal fees to female-headed households.
Sample: Female-headed households in 19 slums.
Findings: Total household assets increased in the treatment group (including an increase of 50% in monetary assets) after one year, with larger effects observed in lower and middle pre-intervention asset groups.
Banerjee et al (2013)
Microcredit has spread extremely rapidly since its beginnings in the late 1970s, but whether and how much it helps the poor is the subject of intense debate. This paper reports on the first randomized evaluation of the impact of introducing microcredit in a new market. Half of 104 slums in Hyderabad, India were randomly selected for opening of an MFI branch while the remainder were not. We show that the intervention increased total MFI borrowing, and study the effects on the creation and the profitability of small businesses, investment, and consumption. Fifteen to 18 months after lending began in treated areas, there was no effect of access to microcredit on average monthly expenditure per capita, but expenditure on durable goods increased in treated areas and the number of new businesses increased by one third. The effects of microcredit access are heterogeneous: households with an existing business at the time of the program invest more in durable goods, while their nondurable consumption does not change. Households with high propensity to become new business owners increase their durable goods spending and see a decrease in nondurable consumption, consistent with the need to pay a fixed cost to enter entrepreneurship. Households with low propensity to become business owners increase their nondurable spending. We find no impact on measures of health, education, or women's decision-making.
Intervention settings: Urban (Hyderabad).
Intervention description: Group liability credit in the amount of $200 (at market exchange rates, or $1,00 in PPP-adjusted rates) offered to groups of 6 to 10 women. Loan amounts may increase up to double on successful repayment. Also offered mortgage and insurance products, and savings accounts.
Sample: 2,800 adult, very poor women from slums.
Findings: 32% higher new business creation. Positive impact on business formation among female-headed HH and on business investment among HHs with existing businesses. Female-headed HH in intervention areas more likely to start new business. No significant impact on average total per capita expenditure; or women's business revenues, profits or number of employees. No impact on number of employees in women's businesses. No significant impact on women's business revenues or profits. No impact on women's decision-making on HH spending.
Field et al (2010)
Financiers across the world structure debt contracts to limit the risk of entrepreneurial lending. However, certain debt structures that reduce risk may inhibit enterprise growth, especially among the poor. We use a field experiment to estimate the short- and long-run impacts of varying the term structure of the classic microfinance loan product. While the classic microfinance loan contract requires clients to make small and frequent repayment installments beginning immediately after loan disbursement, clients in our treatment group instead received a two-month grace period before repay- ment began. The shift to a grace period contract increased clients' business investments in the short run and profits and income in the long run, but also their rate of default, indicating a shift towards investments with higher average but also more variable re- turns. In this manner, the absence of a grace period reduces risk but also the potential impact of microfinance on microenterprise growth and household poverty.
Intervention settings: Unknown
Intervention description: Group liability credit. Tested the benefit of using a grace period for loans instead of starting repayment immediately.
Sample: Poor microentrepreneurs and wage workers (75% have home-based business).
Findings: Positive impact of grace period on businesses of some women. Women with grace period invested 6% more of loans in businesses than those with no grace period. After two years, women with grace period increased average profits by 30%. 19% of women with a grace period group defaulted on loans, (compared to 2% default rate among women with standard repayment).
Kaizen for Managerial Skills Improvement in Small and Medium Enterprises: An Impact Evaluation StudySonobe, Suzuki, and Otsuka (2011)
Intervention settings: Urban.
Intervention description: KAIZEN Production management training - to reduce non-value adding operations. Multifaceted classroom training and on-site KAIZEN training. Sample received both trainings, one or the other, or none.
Methodology: RCT - Randomized invitation to participate.
Sample: 100-180 male and female firm owners with typical revenues of $200-300,000 USD per year.
Findings: Entrepreneurs in the sample knew little about standard business practices and attached low value to learning management, but the training improved participants' business practices and recognition of importance of management knowledge. Male owners 20% more likely to participate in training given invitation than females. One year older increases probability of participating by 1-2%.