Credit Participation and Constraints of the Poor in Peri-urban Areas, Vietnam: a Micro-econometric Analysis of a Household Survey

• Autorzy: Tinh Doan , Tran Quang Tuyen
• Języki publikacji: EN

Abstrakty

EN

This paper uses a dataset collected from peri-urban areas of Ho Chi Minh City, Vietnam to examine how the poor use their loans, and factors affecting their credit participation and credit constraints. The paper finds that the presence of many commercial banks in the areas does not help the poor, instead the poor rely heavily on informal credit. Loans in the periurban areas are mainly used for non-productive purposes, which stresses the importance of consumption smoothing. Better community relationships and interpersonal trust in morerural wards help households to access to credit. In urban areas, the poor rely more upon subsidized funds. A closer look at specified microcredit sources reveals that household behaviour differs in each market segment. Furthermore, the poor are highly credit-constrained. Wealthier-asset households among the poor appear to be less credit-constrained. The likelihood of credit constraints increases with the distance to the nearest banks, which suggests that credit supplyside intervention could help overcome credit constraints. Overall, the poor in urban areas are more credit-constrained because of exclusion by commercial banks and weaker interpersonal trust.(original abstract)

Słowa kluczowe

EN

Credit; Financial participation; Households

PL

Kredyt; Partycypacja finansowa; Gospodarstwa domowe

• Czasopismo: Argumenta Oeconomica
• Rocznik: 2015
• Numer: nr 1 (34)
• Strony: 175--200

Twórcy

autor

Tinh Doan

• Economics Department, the University of Waikato, Hamilton, New Zealand and Faculty of Political Economy, VNU University of Economics and Business, Hanoi, Vietnam

autor

Tran Quang Tuyen

• Faculty of Political Economy, VNU University of Economics and Business, Hanoi, Vietnam

Bibliografia

• Allcott, H., Karlan, D., Möbius, M. M., Rosenblat, T. S., Szeidl, A., Community Size and Network Closure, "The American Economic Review", 97(2), pp. 80-85, 2007.
• Armendariz, A., Morduch, J., The Economics of Microfinance (2ndeds). The MIT Press, Cambridge, Massachusetts, 2010.
• Banerjee, A., Duflo, E., Giving Credit Where It Is Due, "Journal of Economic Perspectives", 24(3), pp. 61-80, 2010.
• Barslund, M., Tarp, F., Formal and Informal Rural Credit in Four Provinces of Vietnam, "Journal of Development Studies", 44(4), pp. 485-503, 2007.
• Chen, K., Chivakul, M., What Drives Household Borrowing and Credit Constraints? Evidence from Bosnia and Herzegovina (IMF Working Paper WP/08/202). International Monetary Fund, Washington DC, 2008.
• Conning, J., Udry, C., Rural Financial Markets in Developing Countries (Discussion Paper No. 914). Yale University, Economic Growth Center, 2005.
• Crook, J., The Demand for Household Debt in the USA: Evidence from the 1995 Survey of Consumer Finance, "Applied Financial Economics", 11, pp. 83-91, 2001.
• Crook, J., Hochguertel, S., Household Debt and Credit Constraints: Evidence from OECD Countries (Working Paper Series No 05/02). University of Edinburgh, Credit Research Center, 2005.
• Crook, J., Hochguertel, S., US and European Household Debt and Credit Constraints (Tinbergen Institute Discussion Paper No. 2007-087/3). Retrieved from http://www.tinbergen.nl/discussionpapers/07087.pdf, 2007.
• Debertin, D. (n.d.). A Comparison of Social Capital in Rural and Urban Settings. Retrieved from University of Kentucky, Department of Agricultural Economics website: http://www.uky.edu/~deberti/socsaea.htm
• Del-Rio, A., Young, G., The Determinants of Uncensored Borrowing: Evidence from the British Household Panel Survey (Working Paper No. 263). Bank of England, 2005.
• Diagne, A., Determinants of Household Access to and Pparticipation in Formal and Informal Credit Markets in Malawi (FCND Discussion Paper No.67). International Food Policy Research Institute (IFPRI), Washington, DC, 1999.
• Diagne, A., Zeller, M., Sharma, M., Empirical Measurements of Households' Access to Credit and Credit Constraints in Developing Countries: Methodological Iissues and Evidence. Retrieved from International Food Policy Research Institute (IFPRI) website: http://www.ifpri.org/sites/default/files/publications/fcnbr90.pdf, 2000.
• Doan, T.,Gibson, J. Return to Education in Vietnam during the Recent Transformation, "International Journal of Education Economics and Development", 3(4), pp. 314-329, 2012.
• Fallon, P., Lucas, R., The Impact of Financial Crises on Labor Markets, Household Incomes and Poverty: A Review of Evidence, "The Work Bank Research Observers", 17(2), pp. 21-45, 2002.
• Hofferth, S. L., Iceland, J., Social Capital in Rural and Urban Communities, Rural Sociology Society. December, 1998.
• IFC, Vietnam Financial Sector Diagnostic. World Bank Group, International Financial Corporation, 2006.
• Izumida, Y., Pham, B. D., Rural Development Finance in Vietnam: An Econometric Analysis of Household Surveys. World Development, 30(2), pp. 319-335, 2002.
• Jappelli, T., Who Is Credit Constrained in the US Economy?, "The Quarterly Journal of Economics", 105(1), 1990.
• Johnston, D., Morduch, J., Microcredit vs. Microsaving: Evidence from Indonesia. Retrieved from http://siteresources.worldbank.org/INTFR/Resources/Microcredit_versus_Micro- saving_Evidence_from_Indonesia.pdf, 2007.
• Johnston, J., Dinardo, J., Econometric Methods. The McGraw-Hill Companies, Inc., New York, 1997.
• Kedir, A., Ibrahim, G., Torres, S., Household-level Credit Constraints in Urban Ethiopia. Retrieved from http://economia.ucu.edu.uy/attachments/026_Credit%20Constraints% 20JAE_2009t.pdf, 2007.
• Khandker, S., Microfinance and Poverty: Evidence Using Panel Data from Bangladesh. "The World Bank Economic Review", 19(2), pp. 263-286, 2005.
• Kim, A., A Market without the 'Right' Property Rights, "Economics of Transition", 12(2), pp. 275-305, 2004.
• Kochar, A., Explaining Household Vulnerability to Idiosyncratic Income Shocks, "American Economic Review", 85(2), pp. 159-1964, 1995.
• Kochar, A., Smoothing Consumption by Smoothing Income: Hours-of-work Responses to Idiosyncratic Agricultural Shocks in Rural India, "Review of Economics and Statistics", 81(1), pp. 50-61, 1999.
• McKenzie, D., Aggregate Shocks and Urban Labor Market Responses: Evidence from Argentina's Financial Crisis, "Economic Development and Cultural Change", 52(4), pp. 719-758, 2004.
• Nguyen, V. C., Determinants of Credit Participation and Its Impact on Household Ccon-sumption: Evidence from Rural Vietnam. Paper presented at the 3rd Leicester PhD Conference on Economics, England, May 2007.
• Rashid, S., The Urban Poor in Dhaka City: Their Struggles and Coping Strategies During the Floods of 1998, "Disasters", 24(3), pp. 240-253, 2000.
• Schreiner, M., Nagarajan, G., Predicting Credit Worthiness with Publicly Observable Characteristics: Evidence from ASCRAs and RoSCAs in the Gambia, "Savings and Development", 22(4), pp. 399-414, 1998.
• Skoufias, E., Economic Crises and Natural Disasters: Coping Strategies and Policy Implications, "World Development", 31(7), pp. 1087-1102, 2003.
• Swain, R. B., The Demand and Supply of Credit for Households, "Applied Economics", 39, pp. 2681-92, 2007.
• VDR, Vietnam Development Report 2004 (Joint Donor Report to the Vietnam consultative Group Meeting in December 2003). Hanoi, Vietnam, 2004.
• Verbeek, M., A Guide to Modern Econometrics. Southern Gate, Chichester, West Sussex, England Hoboken, NJ: John Wiley & Sons, 2004.
• Zeller, M., Determinants of Credit Rationing: A Study of Informal Lenders and Formal Credit Groups in Madagascar. "World Development", 22(12), pp. 1895-1907, 1994.

Identyfikatory

DOI

10.15611/aoe.2015.1.07