Microfinance Programs on Child Education

Question 1

Author of paper?

Answer 1

Holvoet (2004).

Question 2

The experiment:

Answer 2

SOUTH INDIA:
Test the importance of the borrowers gender and the delivery channel for boys’ and girls’ education.
1st: compare the impact direct bank-borrower credit in the hands of mothers and fathers (Integrated Rural Development Program).
2nd: test whether channelling individual credit to mothers through women’s groups creates differential effects (Tamil Nadu Women’s Development Programme).

Question 3

Parents may perceive costs and benefits differently…

Answer 3

There is evidence that mothers prefer to allocate a higher % of the household budget to children’s human capital goods.

Question 4

Issues of selection bias?

Answer 4

Households that received credit in different ways may have had unobservable background characteristics which might explain why they became beneficiaries of a particular programme in the first place - it might lead to differences in outcomes.

Question 5

How to overcome selection bias?

Answer 5

Quasiexperimental design using matching on some important characteristics during the design phase while controlling statistically for remaining differences at the moment of analysis.

Question 6

Dependent variables in the logistic regression?

Answer 6

Incidence of schooling,
Kind of schooling,
Incidence of literacy.

Question 7

Dependent variable in OLS regression?

Answer 7

Number of years of schooling.

Question 8

Characteristics of children in the sample:

Answer 8

Boys were 3.9 times more likely to be enrolled in schools.
Girls received 2 years less of schooling.
The same proportion of girls and boys attended private school.
Female literacy about 1/3 of that of boys.
Compared to eldest son, the eldest daughter is 12 times less likely to attend school.

Question 9

Direct-bank borrower credit results

Answer 9

No statistically significant effects at all on children’s’ schooling or health.

Question 10

Women’s group credit results

Answer 10

Only girls reap the benefits of their mother’s membership (effect is insignificant for boys).
Girls are 3.8-5 times more likely to be sent to school.
Girls are 5.9 times more likely to go to private school.
Girls are 7-9 times more likely to become literate.
Girls benefit from 2.4-3.3 additional years of schooling.

Question 11

Policy implications:

Answer 11

For girls’ education, it matters who decides and who controls resources in the household.
Increasing mothers’ intrahousehold decision making can directly increase girls’ education.
This can be done by channelling credit through well-functioning womans’ groups.