Evaluating the Social and Economic Impact of Microcredit on Individual Borrowers & Their Communities in Mexico
Last registered on July 26, 2016

Pre-Trial

Trial Information
General Information
Title
Evaluating the Social and Economic Impact of Microcredit on Individual Borrowers & Their Communities in Mexico
RCT ID
AEARCTR-0000325
Initial registration date
July 26, 2016
Last updated
July 26, 2016 3:03 PM EDT
Location(s)
Region
Primary Investigator
Affiliation
Northwestern University
Other Primary Investigator(s)
PI Affiliation
Dartmouth College
PI Affiliation
University of Michigan
Additional Trial Information
Status
Completed
Start date
2009-03-01
End date
2015-01-01
Secondary IDs
Abstract
We use a clustered randomized trial, and over 16,000 household surveys, to estimate impacts at the community level from a group lending expansion at 110 percent APR by the largest micro lender in Mexico. We find no evidence of transformative impacts on 37 outcomes (although some estimates have large confidence intervals), measured at a mean of 27 months post-expansion, across 6 domains: micro entrepreneurship, income, labor supply, expenditures, social status, and subjective well-being. We also examine distributional impacts using quantile regressions, given theory and evidence regarding negative impacts from borrowing at high interest rates, but do not find strong evidence for heterogeneity.
External Link(s)
Registration Citation
Citation
Angelucci, Manuela, Dean Karlan and Jonathan Zinman. 2016. "Evaluating the Social and Economic Impact of Microcredit on Individual Borrowers & Their Communities in Mexico." AEA RCT Registry. July 26. https://www.socialscienceregistry.org/trials/325/history/9732
Sponsors & Partners

There are documents in this trial unavailable to the public. Use the button below to request access to this information.

Request Information
Experimental Details
Interventions
Intervention(s)
We worked with Compartamos to randomize its rollout into north-central Sonora (near the Arizona border), an area it had not previously lent in. Specifically, we randomized credit access and loan promotion across 238 geographic “clusters” (neighborhoods in urban areas, towns or contiguous towns in rural areas). Treatment clusters received access to credit and door-to-door loan promotion, whereas control clusters were not given access to credit and received no loan promotion.
Intervention Start Date
2009-04-01
Intervention End Date
2012-04-01
Primary Outcomes
Primary Outcomes (end points)
Loan take-up and financial access, Business activities, Household finances and well-being.
Primary Outcomes (explanation)
Secondary Outcomes
Secondary Outcomes (end points)
Secondary Outcomes (explanation)
Experimental Design
Experimental Design
71 percent of Compartamos clients borrowed through Crédito Mujer, the joint liability microloan product studied in this paper. Crédito Mujer nominally targets women who have a business or self-employment activity or intend to start one. Empirically, we estimate that only about 51 percent of borrowers are “microentrepreneurs.” Crédito Mujer loan amounts during most of the study range from 1,500– 27,000 pesos (12 pesos = US$1), with amounts for first-time borrowers ranging from 1,500–6,000 pesos (US$125–US$500) and larger amounts subsequently available to members of groups that have successfully repaid prior loans.
Experimental Design Details
Randomization Method
randomization done in office by a computer
Randomization Unit
Geographic area
Was the treatment clustered?
Yes
Experiment Characteristics
Sample size: planned number of clusters
238 geographic “clusters” (neighborhoods in urban areas, towns or contiguous towns in rural areas).
Sample size: planned number of observations
16,560 women
Sample size (or number of clusters) by treatment arms
Region 1: (endline-only): Caborca, Agua Prieta, and urban area of Nogales
Treatment: 104
Control: 101

Region 2 (panel sample): outlying areas of Nogales
Treatment: 16
Control: 17
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB
INSTITUTIONAL REVIEW BOARDS (IRBs)
IRB Name
Innovations for Poverty Action Human Subjects Committee
IRB Approval Date
2008-06-01
IRB Approval Number
IRB #061.08June-008
IRB Name
Yale University Human Subjects Committee
IRB Approval Date
2008-06-01
IRB Approval Number
IRB #0808004114
Post-Trial
Post Trial Information
Study Withdrawal
Intervention
Is the intervention completed?
Yes
Intervention Completion Date
April 01, 2012, 12:00 AM +00:00
Is data collection complete?
Yes
Data Collection Completion Date
April 01, 2012, 12:00 AM +00:00
Final Sample Size: Number of Clusters (Unit of Randomization)
Was attrition correlated with treatment status?
No
Final Sample Size: Total Number of Observations
We attempted to track at endline 2,912 households out of the full baseline sample of 6,786 households. We identified 63% of this group, which comprises 1,823 households and yields an attrition rate of 37%.
Final Sample Size (or Number of Clusters) by Treatment Arms
Data Publication
Data Publication
Is public data available?
Yes
Program Files
Program Files
Yes
Reports and Papers
Preliminary Reports
Relevant Papers
Abstract
Author Disclosure Statement(s)
Citation
Angelucci, Manuela, Dean Karlan and Jonathan Zinman. 2015. "Microcredit Impacts: Evidence from a Randomized Microcredit Program Placement Experiment by Compartamos Banco." American Economic Journal: Applied Economics, 7(1): 151-82.
Abstract
We use a clustered randomized trial, and over 16,000 household surveys, to estimate impacts at the community level from a group lending expansion at 110 percent APR by the largest micro lender in Mexico. We find no evidence of transformative impacts on 37 outcomes (although some estimates have large confidence intervals), measured at a mean of 27 months post-expansion, across 6 domains: micro entrepreneurship, income, labor supply, expenditures, social status, and subjective well-being. We also examine distributional impacts using quantile regressions, given theory and evidence regarding negative impacts from borrowing at high interest rates, but do not find strong evidence for heterogeneity.
Citation
Angelucci, Manuela, Dean Karlan, and Jonathan Zinman. 2015. "Microcredit Impacts: Evidence from a Randomized Microcredit Program Placement Experiment by Compartamos Banco." American Economic Journal: Applied Economics 7(1): 151-182.
Abstract
Online Appendix
Citation
Angelucci, Manuela, Dean Karlan and Jonathan Zinman. 2015. "Microcredit Impacts: Evidence from a Randomized Microcredit Program Placement Experiment by Compartamos Banco." American Economic Journal: Applied Economics, 7(1): 151-82.
Abstract
JPAL Bulletin: Seven randomized evaluations from around the world show that microcredit does not have a transformative
impact on poverty, but it can give low-income households more freedom in optimizing the ways they make money,
consume, and invest.
Citation
J-PAL and IPA Policy Bulletin. 2015. “Where Credit is Due.” Cambridge, MA: Abdul Latif Jameel Poverty Action Lab and Innovations for Poverty Action.