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A Structural Evaluation of a Large-Scale Quasi-Experimental Microfinance Initiative

2011; Wiley; Volume: 79; Issue: 5 Linguagem: Inglês

10.3982/ecta7079

1468-0262

Joseph P. Kaboski, Robert M. Townsend,

Financial Literacy, Pension, Retirement Analysis

EconometricaVolume 79, Issue 5 p. 1357-1406 A Structural Evaluation of a Large-Scale Quasi-Experimental Microfinance Initiative Joseph P. Kaboski, Joseph P. Kaboski Dept. of Economics, University of Notre Dame, 717 Flanner Hall, Notre Dame, IN 46556, U.S.A. and NBER; jkaboski@ND.EDUSearch for more papers by this authorRobert M. Townsend, Robert M. Townsend Dept. of Economics, Massachusetts Institute of Technology, Cambridge, MA 02138, U.S.A. and NBER; rtownsen@MIT.EDU Research funded by NICHD Grant R03 HD04776801, the Bill and Melinda Gates Foundation grant to the University of Chicago Consortium on Financial Systems and Poverty, John Templeton Foundation, and NSF. We thank Sombat Sakuntasathien, Aleena Adam, Francisco Buera, Flavio Cunha, Xavier Gine, Donghoon Lee, Audrey Light, Ben Moll, Masao Ogaki, Anan Pawasutipaisit, Mark Rosenzweig, Shing-Yi Wang, Bruce Weinberg, and participants at FRB-Chicago, FRB-Minneapolis, Harvard–MIT, Michigan, NIH, Ohio State, U.W. Milwaukee, NYU, Yale, NEUDC 2006, 2006 Econometric Society, BREAD 2008, World Bank Microeconomics of Growth 2008, UC-UTCC, NYU Development Conference, and SED 2009 presentations. Bin Yu, Taehyun Ahn, and Jungick Lee provided excellent research assistance on this project.Search for more papers by this author Joseph P. Kaboski, Joseph P. Kaboski Dept. of Economics, University of Notre Dame, 717 Flanner Hall, Notre Dame, IN 46556, U.S.A. and NBER; jkaboski@ND.EDUSearch for more papers by this authorRobert M. Townsend, Robert M. Townsend Dept. of Economics, Massachusetts Institute of Technology, Cambridge, MA 02138, U.S.A. and NBER; rtownsen@MIT.EDU Research funded by NICHD Grant R03 HD04776801, the Bill and Melinda Gates Foundation grant to the University of Chicago Consortium on Financial Systems and Poverty, John Templeton Foundation, and NSF. We thank Sombat Sakuntasathien, Aleena Adam, Francisco Buera, Flavio Cunha, Xavier Gine, Donghoon Lee, Audrey Light, Ben Moll, Masao Ogaki, Anan Pawasutipaisit, Mark Rosenzweig, Shing-Yi Wang, Bruce Weinberg, and participants at FRB-Chicago, FRB-Minneapolis, Harvard–MIT, Michigan, NIH, Ohio State, U.W. Milwaukee, NYU, Yale, NEUDC 2006, 2006 Econometric Society, BREAD 2008, World Bank Microeconomics of Growth 2008, UC-UTCC, NYU Development Conference, and SED 2009 presentations. Bin Yu, Taehyun Ahn, and Jungick Lee provided excellent research assistance on this project.Search for more papers by this author First published: 20 September 2011 https://doi.org/10.3982/ECTA7079Citations: 103 AboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onFacebookTwitterLinked InRedditWechat Abstract This paper uses a structural model to understand, predict, and evaluate the impact of an exogenous microcredit intervention program, the Thai Million Baht Village Fund program. We model household decisions in the face of borrowing constraints, income uncertainty, and high-yield indivisible investment opportunities. After estimation of parameters using preprogram data, we evaluate the model's ability to predict and interpret the impact of the village fund intervention. Simulations from the model mirror the data in yielding a greater increase in consumption than credit, which is interpreted as evidence of credit constraints. A cost–benefit analysis using the model indicates that some households value the program much more than its per household cost, but overall the program costs 30 percent more than the sum of these benefits. Citing Literature Volume79, Issue5September 2011Pages 1357-1406 RelatedInformation