This paper reports the results from a randomized evaluation of a microcredit program introduced in rural areas of …, microcredit access led to a significant rise in investment in assets used for self-employment activities (mainly animal husbandry … and agriculture), and an increase in profit. But this increase in profit was offset by a reduction in income from casual …

Many rural households in low and middle income countries continue to rely on small-scale agriculture as their primary … source of income. In the absence of irrigation, income arrives only once or twice per year, and has to cover consumption and … more liquidity-constrained farms. This reallocation reduces consumption and income inequality among treated farmers and …

microcredit can improve firm profitability, and suggest that GE effects can substantially shape microcredit's effectiveness. In … particular, failure to consider these GE effects could lead to underestimates of the social welfare benefits of microcredit …