Phil Mader and others picked up a theme I neglected in my previous post: the stories of microcredit-induced suicide in India. I gather that these have been prominent in the local media and have been a key part of the campaign to rein in microfinance institutions.
As I replied in the comments, I just don't know what to make of these reports. Stories can be exaggerated. Creditors have always been tempting scapegoats. The press is not apolitical. Perhaps the best response I can make is to borrow from Phil, who has blogged with deep concern about this issue. Separately he wrote:
In the popular literature surrounding microcredit (or microfinance), a number of claims is repeatedly made which deserve a closer look. The mass media are full of heartwarming stories, anecdotes and PR-like representations of MFIs’ work, showing the apparent power of microcredit to improve the lives of the poorer inhabitants of this planet. In fact, many academic productions make similar claims without providing sufficient evidence to back them up.
Trade "heartrending" for "heartwarming" and "destroy" for "improve" and you get my point. Watch out for those stories.
Which is not to say that the Indian microfinance industry isn't careening dangerously.
If you want to learn more about suicides in India, you should read Accidental Deaths & Suicides in India, a page-turner from India's National Crime Records Bureau, which I guess is the one of the few statistical agencies in the world to scroll head shots of dead bodies on its home page. In the report, you can find pie charts, tables, graphs, and maps of suicides in India by state, cause, age, sex, and means. Here's a graph of suicides caused by "Bankruptcy or Sudden Change in Economic Status" in Andhra Pradesh, where microcredit has exploded in the last five years. Make of it what you will:
Sources by year: 2004, 2005, 2006, 2007, 2008.