Lending a Hand: A Quantile Regression Analysis of Micro-Lending's Poverty Impact

Colorado College Department of Economics and Business Working Paper No. 2009-10

21 Pages Posted: 11 Dec 2009  

Stephen W. Polk

Colorado College - Department of Economics and Business

Daniel K. N. Johnson

Colorado College - Department of Economics and Business

Date Written: December 10, 2009

Abstract

This paper analyzes a database of over 18,000 women micro-finance clients of the Negros Women for Tomorrow Foundation (NWTF), a database using the Progress Out of Poverty (PPI) Scorecard as a measure of poverty. Analysis using both OLS and quantile regression models shows how observable characteristics of borrowers affect the ability of clients to reduce their measured poverty. Loan size, duration, and the economic activity supported all have strongly identifiable effects. Moreover, estimates suggest which among the poor are receiving the greatest effective help by the program. Results offer advice to the NWTF and offer insight useful to policymakers and other micro-lenders.

Keywords: micro-finance, Grameen, poverty, quantile regression, lending, microlending

JEL Classification: O16, I32, I38, G21

Suggested Citation

Polk, Stephen W. and Johnson, Daniel K. N., Lending a Hand: A Quantile Regression Analysis of Micro-Lending's Poverty Impact (December 10, 2009). Colorado College Department of Economics and Business Working Paper No. 2009-10. Available at SSRN: https://ssrn.com/abstract=1521607 or http://dx.doi.org/10.2139/ssrn.1521607

Stephen W. Polk

Colorado College - Department of Economics and Business ( email )

14 E Cache La Poudre Street
Colorado Springs, CO 80903
United States

Daniel Kent Neil Johnson (Contact Author)

Colorado College - Department of Economics and Business ( email )

14 E Cache La Poudre Street
Colorado Springs, CO 80903
United States
719-389-6654 (Phone)
719-389-6927 (Fax)

HOME PAGE: http://faculty1.coloradocollege.edu/~djohnson

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