Can Rural Banks Reduce Poverty? Evidence from the Indian Social Banking Experiment

نویسندگان

  • Robin Burgess
  • Rohini Pande
چکیده

We exploit the introduction and removal of a nation-wide bank branch licensing rule which sought to increase and equalize bank branch presence across Indian states to estimate the e¤ect of rural bank openings on poverty. Between 1977 and 1990, to qualify for a license to open a branch in a census location which already had one or more bank branches an Indian bank had to open four branches in locations with no bank branches. This policy caused banks to open relatively more rural branches in Indian states with lower initial …nancial development between 1977 and 1990. The reverse was true outside this period. We use these policy-induced trend reversals in the relationship between a state’s initial …nancial development and rural branch expansion as instruments for rural branch expansion and …nd that rural branch expansion in India signi…cantly reduced rural poverty. We thank Esther Du‡o for very helpful and detailed comments. We have bene…ted from comments and suggestions from Josh Angrist, Abhijit Banerjee, Tim Besley, Richard Blundell, Bronwen Burgess, David Card, Anne Case, Ken Chay, Jonathan Murdoch, Atif Mian, Andrew Newman, Dom Leggett, Debraj Ray, Mark Rosenzweig, Ken Sokolo¤, Duncan Thomas, Robert Townsend, two anonymous referees and seminar participants at the Bureau for Research in Economic Analysis of Development (BREAD) 2002 Meeting, Caltech, CEPR Public Policy Meeting 2003, Cornell, Harvard, IMF, LSE, MIT, NYU, Michigan, Penn State, Princeton, Southampton, Stanford, Stockholm, UBC, UCLA, UCSD, World Bank and Yale. Juan de Laiglesia, Mattia Romani, Gaurav Shah, Heidee‡ower Stoller and Grace Wong provided exceptional research assistance.

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

منابع مشابه

Can Rural Banks Reduce Poverty? Evidence from the Indian Social Banking Experiment

We exploit the introduction and removal of a nation-wide bank branch licensing rule which sought to increase and equalize bank branch presence across Indian states to estimate the e¤ect of rural bank openings on poverty. Between 1977 and 1990, to qualify for a license to open a branch in a census location which already had one or more bank branches an Indian bank had to open four branches in lo...

متن کامل

Reduction of Poverty Using ICT in SADC Region: A case Study

Poverty reduction is a prominent issue for both governments and international organisations. It is one of the millennium development goals of the UN. Developing countries have high poverty levels than developed ones. However the diffusion of basic information and communications technologies (ICTs) services have penetrated majority of developing countries. Using SADC (South African Development C...

متن کامل

Implications of Banking Consolidation for the Financing of Rural America

This paper examines what we can learn from existing studies, or could learn from existing data, about the implications of banking consolidation for the financing of economic activity in rural areas. The evidence indicates that large organizations will expand their offices in rural areas. The role of relatively small banks headquartered in rural areas as providers of banking services in their co...

متن کامل

Evaluation of the effective factors on poverty reduction with an emphasis on new indicators of regionalism Case: Kuhdasht city - Lorestan Province

Introduction Poverty is a multi-factorial and complex phenomenon. The complexity of this phenomenon is due to the various dimensions and the multiplicity of its causes. Thereby, different social sciences have approached this phenomenon with different approaches. It has been tried to eliminate this unwanted phenomenon so far, but it has not yet been able to eradicate this problem from society. ...

متن کامل

Banking Reform in India∗

Measured by share of deposits, 83 percent of the banking business in India is in the hands of state or nationalized banks, which are banks that are owned by the government, in some, increasingly less clear-cut way. Moreover, even the non-nationalized banks are subject to extensive regulations on who they can lend to, in addition to the more standard prudential regulations. Government control ov...

متن کامل

ذخیره در منابع من


  با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

عنوان ژورنال:

دوره   شماره 

صفحات  -

تاریخ انتشار 2004