Social groups and credit shocks : evidence of inequalities in consumption smoothing
MetadataShow full item record
Altmetrics Handle Statistics
A strand of research holds the view that restricting access to credit to regulate over-borrowing can worsen consumers’ financial condition. Another strand of research holds the view that access to credit in the developing countries with subprime credit markets is determined by social groupings and ethnic affiliations. By merging these two strands of research, we investigate the impact of Andhra Pradesh microfinance act (2010) on the consumption expenditure of marginalised social groups and the upper caste Hindu groups in India. We construct an aggregated district level panel data for eight quarters and estimate the impact of unanticipated policy change. The results of our analysis show that the sudden restriction of access to credit has larger impact on the consumption levels of the marginalised social groups: lower castes, tribes, and Muslims. The findings also confirm the failure of contingency policy enacted for smoothing consumption.
Saxena , V , Bindal , I & LeMay-Boucher , P 2019 ' Social groups and credit shocks : evidence of inequalities in consumption smoothing ' School of Economics and Finance Discussion Paper , no. 1901 , University of St Andrews , St Andrews , pp. 1-28 .
Working or discussion paper
Copyright (c) the authors
Items in the St Andrews Research Repository are protected by copyright, with all rights reserved, unless otherwise indicated.