Taking Stock of the Evidence on Microfinancial Interventions
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 literature gives much reason to believe that such interventions can lead to wide-scale, transformative impacts akin to escaping aggregate poverty traps.
The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
Joseph P. Kaboski
Kaboski has research grants from the National Institute of Health and MasterCard Foundation for a separate project involving microfinance and entrepreneurship in Uganda, and a research grant from the International Growth Centre for unrelated research on firms and industrial clusters in China and India.