Group lending or Individual lending? Evidence from an RCT in Mongolia

Britta Augsburg , Institute for Fiscal Studies (IFS)

The presentation will cover the set-up and findings from a randomized field experiment in rural Mongolia which aimed to assess the poverty impacts of a joint-liability microcredit program targeted at women. We find a positive impact of access to group loans on female entrepreneurship and household food consumption but not on total working hours or income in the household. A simultaneously introduced individual-liability microcredit program delivers no significant poverty impacts. We present our first ideas around a potential mechanism that might be driving these differential impacts. We set-up a theoretical model which explores the hypothesis that joint liability schemes allow women to mutually insure each other against adverse business outcomes and provide supporting empirical evidence.

About the speaker
Britta is a Senior Research Economist at the Centre for Evaluation of Development Policies (EDePo) at the Institute for Fiscal Studies (IFS) in London, UK. She joined the IFS in 2009, after completing her PhD from the University of Maastricht (Graduate School of Governance). She is now working on generating rigorous evidence on the effectiveness of development policies and programs. Her work aims to understand the effectiveness of programs and policies that tackle constraints to productivity of poverty affected individuals and households, with a particular focus on credit and technology adoption constraints. At present, her main project portfolios focus on microfinance as well as on sanitation technology.

Venue: Conference room

Date: 19 March 2015

Time: 13:00 - 14:00  CET