Microfinance and Women Empowerment: A Panel Data Analysis Using Evidence from Rural Bangladesh

Abstract

Microfinance has long been associated with generating empowerment of women. Over 90% of their clients in Bangladesh are women. The rising demand for credit may seem to indicate the popularity of the program. However, analysing why demand for credit is rising among women may offer a way to analyse empowerment of women. Therefore, this paper utilises this fact and uses a panel data survey to measure individual level outcomes such as labour supply, asset accumulation and family planning and household level outcomes such as children education and household expenditure per annum from participating in a credit program. These outcomes would then be compared to outcomes that can be achieved from borrowing loans from a non-program source. By comparing these outcomes, the benefit of micro finance is extracted, which in turn, is further analysed in terms of whether they indicate empowerment of women.