Review of Microfinance Studies Finds Many Flaws, No Conclusions
By Elaina Hancock
What do we know about microfinance—often touted as the solution for the economic woes of developing countries? Practically nothing, say researchers from UConn’s Department of Agricultural and Resources and Economics.
Assistant professor Nathan Fiala and co-author Mahesh Dahal published research earlier this year in World Development where they showed that current literature about microfinance is statistically underpowered and flawed.
Fiala’s research focuses on impact evaluation. He works with governments, non-governmental organizations, and microfinance institutions (MFIs) across the globe to measure the impact of what they do. The recent paper was not as much a study of microfinance as it was a study of other studies—it is a post-publication evaluation of all eight randomized control trial studies of microfinance that have been published in peer-reviewed journals.
Photo courtesy of Peter Haden.