Abstract

Microfinance programs have become increasingly popular instruments in development policy. Many microfinance programs are supported or subsidized by donors, a fact which calls for detailed analyses of their impacts in order to inform policymakers allocating a limited budget. Fertility reduction is often argued to be important for economic development, and a goal of many governments in developing countries is to reduce fertility. Since microfinance is widespread in Bangladesh, it is an interesting country in which to study the potential for microfinance to assist in achieving a goal of fertility reduction. This study extends the literature on impacts of microfinance by providing panel data estimates of the impacts on fertility resulting from participation in three microfinance programs in Bangladesh. Fixed effects and difference-in-differences estimators used in a quasi experimental setting show no significant effect on fertility from participation in or access to any of the programs. However, some weak evidence that fertility decreases with degree of participation is supported. Results suggest that support to microfinance programs is not the most efficient instrument for governments and organizations working towards a goal of fertility reduction.

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Additional Information

ISSN
1548-2278
Print ISSN
0022-037X
Pages
pp. 297-313
Launched on MUSE
2012-04-07
Open Access
No
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