Boonperm, JirawanHaughton, JonathanKhandker, Shahidur R.2012-03-192012-03-192009-07-01https://hdl.handle.net/10986/4202This paper evaluates the impact of the Thailand Village and Urban Revolving Fund on household expenditure, income, and assets. The revolving fund was launched in 2001 when the Government of Thailand promised to provide a million baht (about $22,500) to every village and urban community in Thailand as working capital for locally-run rotating credit associations. The money about $2 billion in total was quickly disbursed to locally-run committees in almost all of Thailand s 74,000 villages and more than 4,500 urban (including military) communities. By May 2005, the committees had lent a total of about $8 billion, with an average loan of $466. Using data from the Thailand Socioeconomic Surveys of 2002 and 2004, each of which surveys almost 35,000 households, the authors find that the borrowers were disproportionately poor and agricultural. A propensity score matching model finds that Fund borrowing in 2004 was associated with, on average, 1.9 percent more income, 3.3 percent more expenditure, and about 5 percent more ownership of durable goods. These results are broadly consistent with the results from instrumental variables models (where the identifying instrument was the inverse of village size), which however show a smaller (marginal) effect. Households that borrowed both from the revolving fund and from the Bank of Agriculture and Agricultural Cooperatives gained substantially more in terms of higher income than those who borrowed from either one or the other or from neither.CC BY 3.0 IGOACCESS TO CREDITAGRICULTURAL ACTIVITIESAGRICULTURAL COOPERATIVESAGRICULTURAL INPUTSAGRICULTURAL LANDAGRICULTUREALLOCATION OF CREDITANNUAL INCOMEANNUAL INTEREST RATEANNUAL INTEREST RATESANTI-POVERTYASSET ACCUMULATIONASYMMETRIC INFORMATIONAVERAGE EXCHANGE RATEBANKSBINDING CONSTRAINTBORROWERBORROWINGBORROWING COSTSCHECKSCONSUMERCONSUMER CREDITCONSUMER DURABLESCONSUMER EXPENDITURECORRUPTIONCOST-EFFECTIVENESSCREDIBILITYCREDIT ASSOCIATIONSCREDIT MARKETCREDIT MARKETSCREDIT SCHEMESCURRENT INCOMEDEBTDEPOSITSDEVELOPMENT BANKDEVELOPMENT ECONOMICSDIMINISHING RETURNSDUMMY VARIABLEDUMMY VARIABLESDURABLEDURABLE ASSETSDURABLE GOODSDURABLESEARNINGSECONOMIC SITUATIONECONOMIC SURVEYSEDUCATIONAL LEVELEMPLOYEEEQUATIONSEQUIPMENTEXCHANGE RATEEXPECTED VALUEEXPENDITUREEXPENDITURESFAMILIESFARM ENTERPRISEFARM ENTERPRISESFARM HOUSEHOLDSFARM INCOMEFARMERFARMERSFARMING COMMUNITIESFEMALE BORROWERSFEMALE-HEADED HOUSEHOLDSFINANCIAL ASSETSFINANCIAL INTERMEDIATIONFINANCIAL MARKETSFINANCIAL SYSTEMSFUNGIBLEGENDERGOVERNMENT SAVINGSGUARANTORSHEAD OF HOUSEHOLDHOLDINGHOUSEHOLD CONSUMPTIONHOUSEHOLD EXPENDITUREHOUSEHOLD FIXED EFFECTSHOUSEHOLD HEADHOUSEHOLD INCOMEHOUSEHOLD INCOMESHOUSEHOLD SPENDINGHOUSEHOLD SURVEYHOUSEHOLD WELFAREHOUSEHOLDSINCOME EFFECTINCREASE IN INCOMEINEQUALITYINFORMATIONAL ASYMMETRIESINSTRUMENTINTEREST RATEINTEREST RATESINTERNATIONAL BANKLENDERSLOANLOAN APPLICATIONSLOAN DEFAULTLOAN SIZELOANABLE FUNDSLOWER INTEREST RATEMANAGERIAL EFFICIENCYMAXIMUM LOAN AMOUNTSMEDICAL CAREMICRO-LENDINGMICROCREDITMICROFINANCEMINIMUM BALANCEMONOPOLYMONTHLY INCOMENET ASSETSOUTSIDE LENDERSOUTSTANDING DEBTPER CAPITA INCOMEPHYSICAL ASSETSPOORPOOR HOUSEHOLDSPOVERTY PROGRAMSPROBABILITYPRODUCTIVITYPURCHASESQUESTIONNAIRERATE OF INTERESTRATE OF RETURNREGIONAL DUMMIESREPAYMENTREPAYMENT OF PRINCIPALREPAYMENT PERIODSREPAYMENTSRESEARCH ASSISTANCERETURNSREVOLVING FUNDROTATING CREDITRURALRURAL AREASRURAL BANKSRURAL BORROWERSRURAL ECONOMYRURAL FEMALERURAL FINANCERURAL FINANCE INSTITUTIONRURAL FINANCE INSTITUTIONSRURAL FINANCIAL INSTITUTIONSRURAL HOUSEHOLDSRURAL PROVINCESSAVINGSSAVINGS BANKSAVINGS DEPOSITSSOURCE OF CREDITSOURCES OF CREDITSOURCES OF INCOMESTATE UNIVERSITYTERMS OF LOANSURBAN AREASURBAN DEVELOPMENTVALUABLEVILLAGEVILLAGE BANKVILLAGE ECONOMIESVILLAGE FUNDVILLAGE FUNDSVILLAGESWAGEWORKING CAPITALWORTHWorld Bank10.1596/1813-9450-5011