The following variables will be constructed: effort, use of alternative credit sources, monitoring, and peer pressure.
For each variable, we have a set of questions from household surveys that adress different aspects.
In our analysis, we will use the individual questions as well as an index combining different questions to get a singular measure for 1) effort, 2) use of alternative credit sources, 3) monitoring, and 4) peer pressure.
For the index calculation, we use the ordinal alpha since we have 3-point Likert Scales (the commonly used Cronbach's Alpha is not applicable for Likert Scales with fewer than 5 points).
We also construct an index for competition as an explanatory variable.