Ideas to Action:

Independent research for global prosperity




June 18, 2009

The Impact of Microcredit on the Poor in Bangladesh: Revisiting the Evidence - Working Paper 174 (June 2013 revision)

CGD fellow David Roodman and Jonathan Morduch a landmark evaluation of the impact of microcredit on poor households in Bangladesh. They replicate the study's statistical analysis and put an end to the controversy surrounding it by showing that it fails to rule out reverse causation. A positive association between microcredit and household spending, for example, may merely indicate that richer families borrow more. With these studies in doubt, solid academic evidence that microcredit reduces poverty is even scarcer than previously understood.