Labor Market Effects of Improved Access to Credit Among the Poor: Evidence from Cape Verde
46 Pages Posted: 10 Feb 2015
Date Written: December 17, 2014
In the context of a collective household choice model, we show that the effects of improved credit access on search intensity by the unemployed are heterogeneous across households and dependent on the within-household bargaining power of the unemployed. We find empirical support for the predictions of our model using a household survey conducted by the authors in Cape Verde. These findings have important implications for the optimal design of microfinance programs, in particular concerning the targeting of loans and the use of microfinance as an instrument to support improved labor market outcomes.
Keywords: Microfinance; Bargaining Power; Collective Household; Job Search
JEL Classification: D13; D14; J20; O11; O12
Suggested Citation: Suggested Citation