Financial Inclusion and Microfinance: On the Cases of ODA and Analysis of the Poverty Reduction Effect

5 Pages Posted: 27 Aug 2014

See all articles by Sungil Kwak

Sungil Kwak

Korea Institute for International Economic Policy

JuYoung Lee

Korea Institute for International Economic Policy

Date Written: April 4, 2014

Abstract

This study analyzes the microfinance ODA projects of Germany and Australia, and presents the exemplary characteristics of each country that Korea will be able to use for Korean microfinance ODA projects. Moreover, this study makes an empirical analysis of whether the use of microfinance reduces poverty by using the methodology of Imai et al. (2012). In particular, this study casts light on the two aspects overlooked by Imai et al. (2012): (1) suitability tests for instrumental variables using a variety of methods and (2) estimation of poverty reduction effect by using two explanatory variables — average amount of microfinance loan per person and microfinance market size per country measured by the ratio of the total microfinance loan amount to GDP. We find evidence that the poverty rate significantly decreases by 0.463% as the average microfinance loan amount per person increases by 10%.

Keywords: Microfinance, ODA support, ODA policy, Industrial development, ODA, Financial Inclusion

Suggested Citation

Kwak, Sungil and Lee, JuYoung, Financial Inclusion and Microfinance: On the Cases of ODA and Analysis of the Poverty Reduction Effect (April 4, 2014). KIEP Research Paper No. World Economic Update-14-13. Available at SSRN: https://ssrn.com/abstract=2487719 or http://dx.doi.org/10.2139/ssrn.2487719

Sungil Kwak (Contact Author)

Korea Institute for International Economic Policy ( email )

[30147] Building C, Sejong National Research Compl
Seoul, 370
Korea, Republic of (South Korea)

JuYoung Lee

Korea Institute for International Economic Policy ( email )

Seoul 137-602

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
190
Abstract Views
707
rank
165,328
PlumX Metrics