The Influence of Microfinance in Rural Karnataka on Female Social Capital
- Social capital accumulation is critical for improving the status of women in India. Diverse and high-quality social contacts promote financial freedom and autonomy in local communities. This study evaluates whether exposure to microfinance loans targeted at women increases female social capital. I implement a difference-in-difference framework to evaluate changes in social and financial networks by gender after the Bharatha Swamukti Samsthe (BSS) microfinance bank extended loans in rural Karnataka. In the first wave, no villages of 75 surveyed were exposed to microfinance. By the second wave, BSS entered 43 villages. I find that for both financial and social relationships, individuals in villages exposed to microfinance experienced a greater probability of losing links, for both female and male networks. Microfinance also decreased clustering, the probability that an individual’s links were also linked to each other but increased gender homophily. These results suggest potentially adverse consequences for female loan recipients, and spillover benefits for men in villages exposed to microfinance.
|Type of resource
|Degree granting institution
|Stanford University, Department of Economics
|Department of Economics
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- Preferred Citation
- Ruda, Minerva. (2020). The Influence of Microfinance in Rural Karnataka on Female Social Capital. Stanford Digital Repository. Available at: https://purl.stanford.edu/pz742ny1350
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