Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/109694
Authors: 
Beaman, Lori
Karlan, Dean
Thuysbaert, Bram
Udry, Christopher
Year of Publication: 
2014
Series/Report no.: 
Center Discussion Paper, Economic Growth Center 1042
Abstract: 
We partnered with a micro-lender in Mali to randomize credit offers at the village level. Then, in no-loan control villages, we gave cash grants to randomly selected households. These grants led to higher agricultural investments and profits, thus showing that liquidity constraints bind with respect to agricultural investment. In loan-villages, we gave grants to a random subset of farmers who (endogenously) did not borrow. These farmers have lower - in fact zero - marginal returns to the grants. Thus we find important heterogeneity in returns to investment and strong evidence that farmers with higher marginal returns to investment self-select into lending programs.
Subjects: 
credit markets
agriculture
returns to capital
JEL: 
D21
D92
O12
O16
Q12
Q14
Document Type: 
Working Paper

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