Microfinance and Vulnerability to Seasonal Famine in a Rural Economy: Evidence from Monga in Bangladesh Report as inadecuate




Microfinance and Vulnerability to Seasonal Famine in a Rural Economy: Evidence from Monga in Bangladesh - Download this document for free, or read online. Document in PDF available to download.

Abstract

This paper takes advantage of a unique data set on 143,000 poor households from northern Bangladesh to analyze the effects of microfinance membership on a household’s ability to cope with seasonal famine known as Monga. We develop an instrumental variables strategy that exploits a jump and a kink at the 10 decimal 0.1 acre land ownership threshold driven by MFI screening process to ensure repayment by excluding the ultra-poor. Evidence from the local 2SLS estimator Dong, 2017 shows that microfinance membership improves food security during the hungry season, especially for the poorest households who struggle to survive at the margin of 1 and 2 meals a day. Microfinance membership also reduces the probability of short-term migration for work during Monga, but is ineffective in reducing the incidence of advance sale of labor at low wages. These conclusions are also supported by estimates from minimum-biased IPW estimator of Millimet and Tchernis 2013 that reduces bias without imposing exclusion restrictions.



Item Type: MPRA Paper -

Original Title: Microfinance and Vulnerability to Seasonal Famine in a Rural Economy: Evidence from Monga in Bangladesh-

Language: English-

Keywords: Microfinance, Ultra-Poor, Aggregate Anticipated Shock, Seasonal Famine, Monga, Coping Mechanisms, Food Security, Distress Sale of Labor, Short-term Migration, Local 2SLS.-

Subjects: I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and PovertyO - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development-





Author: Berg, Claudia

Source: https://mpra.ub.uni-muenchen.de/80189/



DOWNLOAD PDF




Related documents