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Keywords

Microfinance, rct, Experiment

Abstract

Microfinance institutions (MFIs) allow the poor access to capital in order to overcome the poverty trap and lift themselves into prosperity. With the success of Muhammad Yunus and the Grameen Bank, MFIs have become a popular solution to poverty alleviation in the developing world. However, their objective impact on poverty remains uncertain. Researchers have performed studies and experiments with mixed results. Despite its popularity, microfinance may not be as effective as people believe. Do MFIs value scientific information on their effectiveness? If so, the poor may be more likely to benefit from effective programs as MFIs make changes responsive to such research. If not, MFIs may resist improving their programs at the expense of the poor. We ran a randomized controlled trial on MFIs around the world to determine whether or not MFIs are willing to improve given positive or negative research about the effectiveness of microfinance. Results support our hypothesis that MFIs that receive positive information are more likely to request partnership for an impact evaluation, and MFIs that receive negative information are less likely to do so. This knowledge could help academics and donors know how MFIs respond to new information.

Description

The Annual Mary Lou Fulton Mentored Research Conference showcases some of the best student research from the College of Family, Home, and Social Sciences. The mentored learning program encourages undergraduate students to participate in hands-on and practical research under the direction of a faculty member. Students create these posters as an aide in presenting the results of their research to the public, faculty, and their peers.

Publication Date

2012-03-26

Permanent URL

http://hdl.lib.byu.edu/1877/2875

Language

English

College

Family, Home, and Social Sciences

Are Microfinance Institutions Immune to Science?: A Randomized Controlled Trial

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