IDEAS home Printed from https://ideas.repec.org/a/eee/deveco/v98y2012i1p71-75.html
   My bibliography  Save this article

List randomization for sensitive behavior: An application for measuring use of loan proceeds

Author

Listed:
  • Karlan, Dean S.
  • Zinman, Jonathan

Abstract

Policymakers and microfinance institutions (MFIs) often claim to target poor entrepreneurs who then invest loan proceeds in their businesses. Typically in non-research settings these claims are assessed using readily available but unverified self-reports from client loan applications. Alternatively, independent surveyors could directly elicit how borrowers spent their loan proceeds. That too, however, could suffer from deliberate misreporting. We use data from the Peru and the Philippines in which independent surveyors elicited loan use both directly (i.e., by asking how individuals spent their loan proceeds) and indirectly (i.e., through a list-randomization technique that allows individuals to hide their answer from the surveyor). We find that direct elicitation under-reports the non-enterprise uses of loan proceeds.

Suggested Citation

  • Karlan, Dean S. & Zinman, Jonathan, 2012. "List randomization for sensitive behavior: An application for measuring use of loan proceeds," Journal of Development Economics, Elsevier, vol. 98(1), pages 71-75.
    • Handle: RePEc:eee:deveco:v:98:y:2012:i:1:p:71-75
    DOI: 10.1016/j.jdeveco.2011.08.006
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0304387811000873
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jdeveco.2011.08.006?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Dean Karlan & Jonathan Zinman, 2008. "Lying About Borrowing," Journal of the European Economic Association, MIT Press, vol. 6(2-3), pages 510-521, 04-05.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Stephanie Moulton & Cäzilia Loibl & Anya Samak & J. Michael Collins, 2013. "Borrowing Capacity and Financial Decisions of Low-to-Moderate Income First-Time Homebuyers," Journal of Consumer Affairs, Wiley Blackwell, vol. 47(3), pages 375-403, November.
    2. Meta Brown & Andrew F. Haughwout & Donghoon Lee & Wilbert Van der Klaauw, 2011. "Do we know what we owe? A comparison of borrower- and lender-reported consumer debt," Staff Reports 523, Federal Reserve Bank of New York.
    3. Blattman, Christopher & Jamison, Julian & Koroknay-Palicz, Tricia & Rodrigues, Katherine & Sheridan, Margaret, 2016. "Measuring the measurement error: A method to qualitatively validate survey data," Journal of Development Economics, Elsevier, vol. 120(C), pages 99-112.
    4. Arna Vardardottir & Michaela Pagel, 2016. "The Liquid Hand-to-Mouth: Evidence from a Personal Finance Management Software," 2016 Meeting Papers 789, Society for Economic Dynamics.
    5. Reboul, E. & Guérin, I. & Nordman, C.J., 2021. "The gender of debt and credit: Insights from rural Tamil Nadu," World Development, Elsevier, vol. 142(C).
    6. Augsburg, Britta & Caeyers, Bet & Giunti, Sara & Malde, Bansi & Smets, Susanna, 2023. "Labeled loans and human capital investments," Journal of Development Economics, Elsevier, vol. 162(C).
    7. Dean Karlan & Jonathan Zinman, 2010. "Expanding Credit Access: Using Randomized Supply Decisions to Estimate the Impacts," The Review of Financial Studies, Society for Financial Studies, vol. 23(1), pages 433-464, January.
    8. Arna Olafsson & Michaela Pagel, 2018. "The Liquid Hand-to-Mouth: Evidence from Personal Finance Management Software," The Review of Financial Studies, Society for Financial Studies, vol. 31(11), pages 4398-4446.
    9. Olafsson, Arna & Gathergood, John, 2020. "The Co-holding Puzzle: New Evidence from Transaction-Level Data," CEPR Discussion Papers 14799, C.E.P.R. Discussion Papers.
    10. Merike Kukk, 2019. "Debt repayment problems: short-term and long-term implications for spending," Review of Economics of the Household, Springer, vol. 17(2), pages 715-740, June.
    11. Asadul Islam & Chongwoo Choe, 2013. "Child Labor And Schooling Responses To Access To Microcredit In Rural Bangladesh," Economic Inquiry, Western Economic Association International, vol. 51(1), pages 46-61, January.
    12. Thomas Chesney & Kay Penny, 2013. "The Impact of Repeated Lying on Survey Results," SAGE Open, , vol. 3(1), pages 21582440124, January.
    13. Claire Greene & Scott Schuh & Joanna Stavins, 2017. "The 2015 Survey of Consumer Payment Choice: summary results," Research Data Report 17-3, Federal Reserve Bank of Boston.
    14. Augsburg,Britta & Caeyers,Bet & Giunti,Sara & Malde,Bansi Khimji & Smets,Susanna, 2019. "Labelled Loans, Credit Constraints and Sanitation Investments," Policy Research Working Paper Series 8845, The World Bank.
    15. Radermacher, Jan W., 2023. "Mamma Mia! Revealing hidden heterogeneity by PCA-biplot: MPC puzzle for Italy's elderly poor," SAFE Working Paper Series 382, Leibniz Institute for Financial Research SAFE.
    16. Marek Kośny & Jakub Sawulski & Aneta Kiełczewska, 2024. "Measuring the scale of envelope wages: Evidence from Poland," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 32(3), pages 949-970, July.
    17. Gathergood, John, 2012. "Self-control, financial literacy and consumer over-indebtedness," Journal of Economic Psychology, Elsevier, vol. 33(3), pages 590-602.
    18. Choi, Kyoung Jin & Jeon, Junkee & Koo, Hyeng Keun, 2022. "Intertemporal preference with loss aversion: Consumption and risk-attitude," Journal of Economic Theory, Elsevier, vol. 200(C).
    19. Stephan Meier & Charles Sprenger, 2010. "Present-Biased Preferences and Credit Card Borrowing," American Economic Journal: Applied Economics, American Economic Association, vol. 2(1), pages 193-210, January.
    20. John Gibson & David McKenzie & Bilal Zia, 2014. "The Impact of Financial Literacy Training for Migrants," The World Bank Economic Review, World Bank, vol. 28(1), pages 130-161.

    More about this item

    Keywords

    Survey methodology; Microcredit loan use; List randomization; Direct elicitation;
    All these keywords.

    JEL classification:

    • C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • C89 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Other

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:deveco:v:98:y:2012:i:1:p:71-75. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/devec .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.