Ranjula Bali Swain
() and Maria Floro
Ranjula Bali Swain: Department of Economics, Postal: Department of Economics, Uppsala University, P.O. Box 513, SE-751 20 Uppsala, Sweden
Maria Floro: Department of Economics, American University, Postal: 4400 Massachusetts Avenue NW, Washington DC 20016,
Abstract: We investigate if participation in Indian Self Help Group microfinance program (SHG) results in reducing vulnerability. Vulnerability estimates are constructed using cross-sectional SHG rural household survey data, collected in 2003. The potential selection bias is eliminated by propensity score matching to estimate the average treatment on treated effect using nearest neighbour matching and local linear regression algorithm. We find that despite a disproportionately high percentage of poor in the SHG members, vulnerability is not significantly different between the SHG and non-SHG members. This result is found to be robust using sensitivity analysis and Rosenbaum bounds method.
32 pages, December 10, 2010
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