Photo by nilsson from unsplash
It is widely accepted that rural microcredit has the potential to contribute to poverty reduction in developing countries. This paper examines the factors that affect rural residents decisions to participate… Click to show full abstract
It is widely accepted that rural microcredit has the potential to contribute to poverty reduction in developing countries. This paper examines the factors that affect rural residents decisions to participate in different types of microcredit, and how these factors impact on household income and consumption, using cross-sectional data from a survey in China. A multinomial endogenous switching regression model is employed to account for selection bias and treatment effects. The empirical findings indicate that family size, dependency ratio, local casual wage rate, credit information and shocks mainly determine the selection of different credit sources. Furthermore, the estimates reveal that participation in microcredit tends to increase both per capita income and consumption significantly. Acknowledgement :
Journal Title: Journal of International Development
Year Published: 2018
Link to full text (if available)
Share on Social Media: Sign Up to like & get
recommendations!