Monday, August 3, 2009

What does microcredit do?

Academics have been trying to work out from the evidence whether microcredit does actually raise people's incomes.

But it's been hard to do a proper scientific survey, since you need to compare those who do get a loan with a control group of similar people who don't.

Dean Karlan, professor of economics at Yale University, has managed to do it - with a control group - in the Philippines. His results raise some serious questions about the effectiveness of microcredit in reducing poverty.
--BBC on microcredit

Hear Dean Karlan's BBC interview here.

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