The Miracle of Microfinance? Evidence from a Randomized Evaluation

Abhijit Banerjee, Esther Duflo, Rachel Glennerster, Cynthia Kinnan

2014

This paper reports results from the randomized evaluation of a group lending microcredit program in Hyderabad, India. A lender worked in 52 randomly selected neighborhoods, leading to an 8.4 percentage point increase in takeup of microcredit. Small business investment and profits of pre-existing businesses increased, but consumption did not significantly increase.

Type

Working Paper

Thematic Area

Financial Inclusion