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Development Theory 2nd Edition, Jan Nederveen Pieterse

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Progress in Development Studies
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The impact of micro-credit on poverty: evidence from Bangladesh

M. Jahangir Alam Chowdhury

Department of Finance and Banking, University of Dhaka, Bangladesh

Dipak Ghosh

Department of Economics, University of Stirling, Stirling FK9 4LA, UK, dipak.ghosh{at}stir.ac.uk

Robert E. Wright

Department of Economics, University of Stirling, Stirling FK9 4LA, UK

This paper examines empirically the impact of micro-credit on poverty in Bangladesh. Unlike previous studies, the focus is on both objective and subjective poverty and particular attention is paid to the length of time programme participants have had access to micro-credit. A household-level survey (N = 954) was carried out, collecting information about micro-credit recipients from Grameen Bank, the Bangladesh Rural Advancement Committee and the Association of Social Advancement. Our two main findings are, first, micro-credit is associated with both lower objective and subjective poverty and, secondly, the impact of micro-credit on poverty is particularly strong for about six years with some levelling off after that point.

Key Words: Asia • Bangladesh • duration • micro-credit • objective poverty • subjective poverty

Progress in Development Studies, Vol. 5, No. 4, 298-309 (2005)
DOI: 10.1191/1464993405ps116oa
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Progress in Development Studies, April 1, 2009; 9(2): 115 - 125.
[Abstract] [PDF]