Aggregating Distributional Treatment Effects: A Bayesian Hierarchical Analysis of the Microcredit Literature
- (pp. 1818-47)
Abstract
Expanding credit access in developing contexts could help some households while harming others. Microcredit studies show different effects at different quantiles of household profit, including some negative effects; yet these findings also differ across studies. I develop new Bayesian hierarchical models to aggregate the evidence on these distributional effects for mixture-type outcomes such as household profit. Applying them to microcredit, I find a precise zero effect from the fifth to seventy-fifth quantiles, and uncertain yet large effects on the upper tails, particularly for households with business experience. These quantile estimates are more reliable than averages because the data are fat tailed.Citation
Meager, Rachael. 2022. "Aggregating Distributional Treatment Effects: A Bayesian Hierarchical Analysis of the Microcredit Literature." American Economic Review, 112 (6): 1818-47. DOI: 10.1257/aer.20181811Additional Materials
JEL Classification
- G21 Banks; Depository Institutions; Micro Finance Institutions; Mortgages
- G51 Household Finance: Household Saving, Borrowing, Debt, and Wealth
- L25 Firm Performance: Size, Diversification, and Scope
- O16 Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
- P34 Socialist Institutions and Their Transitions: Financial Economics