Are microfinance impact assessments valid?
Much of the hullaballoo about RCT is misplaced. As has been said below/above in this blog, RCT emerged from drug trials. The local economy is a vastly different context. A local economy is largely finite. Demand does not automatically adjust upwards to match the inflow of new microenterprises producing goods and services meant to be sold locally. So inevitably most new microenterprise capacity will simply displace incumbent capacity. The question is How much? Studies in the UK in the 1980s showed up to 100% displacement at times in some sectors, (i.e., all new jobs in a microenterprise were offset by job losses in the same type of microenterprise somewhere else in the local community). Elsewhere, the figures were generally always above 50%. Also, researchers found higher displacement figures in the poorer regions, suggesting that higher poverty means higher displacement. Not good news for developing countries then, suggesting that microfinance might actually be making things worse for
Related Questions
- How do microfinance institutions balance social impact and financial performance, isn’t this a contradiction?
- Does MOD have the necessary Environmental expertise to carry out the impact assessments required by POEMS?
- Speaking strictly scientifically, are there valid arguments that mans impact on global warming is minor?
