Group Lending or Individual Lending? Evidence from a Randomized Field Experiment in Rural Mongolia

O.P. Attanasio, B. Augsburg, R. de Haas, E. Fitzsimons, H. Harmgart

Research output: Working paperDiscussion paperOther research output

531 Downloads (Pure)

Abstract

Abstract: We present evidence from a randomized field experiment in rural Mongolia on the comparative poverty impact of group versus individual microcredit. We find a positive impact of group loans but not of individual loans on entrepreneurship and food consumption. Moreover, group borrowers are less likely to make informal transfers to families and friends while the opposite holds true for individual borrowers. This suggests that joint liability may deter borrowers from using loans for non-investment purposes with stronger impacts as a result. We find no difference in repayment rates between both types of microcredit.
Original languageEnglish
Place of PublicationTilburg
PublisherFinance
Number of pages68
Volume2013-074
Publication statusPublished - 2013
Externally publishedYes

Publication series

NameCentER Discussion Paper
Volume2013-074

Keywords

  • Microcredit
  • poverty
  • randomized field experiment

Fingerprint Dive into the research topics of 'Group Lending or Individual Lending? Evidence from a Randomized Field Experiment in Rural Mongolia'. Together they form a unique fingerprint.

  • Cite this

    Attanasio, O. P., Augsburg, B., de Haas, R., Fitzsimons, E., & Harmgart, H. (2013). Group Lending or Individual Lending? Evidence from a Randomized Field Experiment in Rural Mongolia. (CentER Discussion Paper; Vol. 2013-074). Finance.