“Correlation is not causation”: Roodman takes issue with World Bank study

Monday, April 21, 2014

The Economist just posted an article on the state of microfinance in Bangladesh. I’m surprised at how weak it is:

  • The article reports that on April 6, the government of Bangladesh arrogated for itself the right to appoint members of the board of the Grameen Bank, while providing almost no interpretive context for this move.
  • It describes a new study of the impact of microcredit in Bangladesh by Shahidur Khandker and Hussain Samad as the “biggest” so far, by which it seems to mean the one with the most households in it. Not so. The new study has 1,509–2,322 households depending on how you count (see the paper’s Table 1); as a counterexample, a study in Hyderabad, India, had about 6,850. The new study is however the longest, tracking families for a remarkable 20 years.

Source: David Roodman (link opens in a new window)

Education, Impact Assessment
microfinance, poverty alleviation, research