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Determinants of Farmers’ Access to Credit in the Lao People’s Democratic Republic

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  • Wongpit, Piya
  • Sisengnam, Keuangkham

Abstract

Access to credit for farmers remains a huge challenge in the Lao PDR. This study aims to identify the determinants of farmers’ access to credit. To achieve this goal, this research uses a data set from a country-wide household survey conducted in 2019. The survey took place in six provinces – Attapue, Champasack, Khammouane, Savannakhet, Vientiane, and Xiengkhuang. The current study applies a Logit model to analyze what factors significantly determine farmers’ access to credit. The result shows that the age of the household head is concavely related to credit access. Household size is negatively correlated with access to credit. Household income is found to have an insignificant impact on demand for credit while household saving does have a significant impact. The area of agricultural land does matter for access to credit because it is commonly used as collateral. The incidence of natural disasters in the last three years significantly determines households’ access to credit.

Suggested Citation

  • Wongpit, Piya & Sisengnam, Keuangkham, 2022. "Determinants of Farmers’ Access to Credit in the Lao People’s Democratic Republic," Asian Journal of Applied Economics, Kasetsart University, Center for Applied Economics Research, vol. 29(2).
    • Handle: RePEc:ags:thkase:334654
    DOI: 10.22004/ag.econ.334654
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    References listed on IDEAS

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    1. Sana Ben Abdessalem Kacem & Sonia Ghorbel Zouari, 2013. "The determinants of access to financial services for micro-credit associations: Application on Tunisian case," E3 Journal of Business Management and Economics., E3 Journals, vol. 4(2), pages 031-046.
    2. Zeller, Manfred, 1994. "Determinants of credit rationing: A study of informal lenders and formal credit groups in Madagascar," World Development, Elsevier, vol. 22(12), pages 1895-1907, December.
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    Cited by:

    1. Wongpit, Piya & Syphoxay, Pakaiphone & Sisoumang, Bounthom & Sykhanthong, Sengsulixay, 2023. "Mapping the Coffee Value Chain in Lao PDR: Issues, Insights, and Strategies," Research on World Agricultural Economy, Nan Yang Academy of Sciences Pte Ltd (NASS), vol. 4(4), October.

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