IDEAS home Printed from https://ideas.repec.org/p/ags/cmpart/157595.html
   My bibliography  Save this paper

The Impact Of Community Savings And Investment Promotion Program On Household Income And Credit Market Participation In Kasungu District, Central Malawi

Author

Listed:
  • MWALUGHALI, OBED GILBERT FREDRICK

Abstract

This study analyses the impact of Community Savings and Investment Program (COMSIP) activities on household income and credit of member households of COMSIP groups in Kasungu District in Central Malawi. COMSIP groups are a form of village-based microcredit and community-based savings institutions with a number of socio-economic functions. The functions include mobilization of communities to save and/or invest their resources into income generating initiatives and provide credit. Using data from COMSIP Cooperative Union limited for Kasungu District in Malawi on income per capita and access to credit, this study tests the hypothesis that these variables were positively impacted on by membership to these COMSIP groups. The study uses Instrumental Variables (IV) methodology organized to reduce selection bias as well as endogeneity problems in the sample. The primary data on socio-economic and demographic variables was collected using household questionnaires, Key Informant Interviews and literature review as tools from a sample of 150 households. The study found that the variables such as sex of household head, age of household head, credit per capita, land per capita and distance of location of household to the COMSIP office, determine household decision to join COMSIP groups. Instrumental Variables analysis results show that the effect of COMSIP groups on household income and credit is very strong. The IV estimates indicate an increase of 88% income per capita and 96% increase in credit per capita of relatively poor participating households was significant at 5% and 1% levels of significance respectively. The findings also indicate that the simple targeting mechanism of COMSIP program based on household vii land ownership is effective. Thus, the efficiency of the COMSIP program can be enhanced by allocating credit to households with marginal landholding, for which the impact is the greatest. Although microfinance programs, especially among the rural poor people living below the standard poverty line of one US dollar per day have elicited different reactions from different stakeholders, there seems to be a general agreement that the program is useful amongst the strategies for ensuring improved household income and credit of rural Malawians, hence reduced poverty in the long-run.

Suggested Citation

  • Mwalughali, Obed Gilbert Fredrick, 2013. "The Impact Of Community Savings And Investment Promotion Program On Household Income And Credit Market Participation In Kasungu District, Central Malawi," Research Theses 157595, Collaborative Masters Program in Agricultural and Applied Economics.
    • Handle: RePEc:ags:cmpart:157595
    DOI: 10.22004/ag.econ.157595
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/157595/files/Obed%20Gilbert%20Fredick%20Thesis.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.157595?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
    ---><---

    References listed on IDEAS

    as
    1. Richard Blundell & Monica Costa Dias, 2009. "Alternative Approaches to Evaluation in Empirical Microeconomics," Journal of Human Resources, University of Wisconsin Press, vol. 44(3).
    2. Wooldridge, Jeffrey M., 2003. "Further results on instrumental variables estimation of average treatment effects in the correlated random coefficient model," Economics Letters, Elsevier, vol. 79(2), pages 185-191, May.
    3. Doss, Cheryl R. & Morris, Michael L., 2001. "How does gender affect the adoption of agricultural innovations?: The case of improved maize technology in Ghana," Agricultural Economics, Blackwell, vol. 25(1), pages 27-39, June.
    4. Deborah A. Cobb‐Clark & Thomas Crossley, 2003. "Econometrics for Evaluations: An Introduction to Recent Developments," The Economic Record, The Economic Society of Australia, vol. 79(247), pages 491-511, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fred Gichana Atandi & Henry M. Bwisa & Maurice Sakwa, 2016. "Technological Innovation as entrepreneurial Determinant affecting Savings Mobilization among Micro and Small Enterprises in Kenya," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 6(3), pages 178-199, March.
    2. Fred Gichana Atandi & Henry M. Bwisa & Maurice Sakwa, 2016. "Influence of Entrepreneurial Customer Experience on Savings Mobilization among Micro and Small Enterprises," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 6(4), pages 1-22, April.

    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. Crespo Cuaresma, Jesus & Oberhofer, Harald & Vincelette, Gallina Andronova, 2014. "Firm growth and productivity in Belarus: New empirical evidence from the machine building industry," Journal of Comparative Economics, Elsevier, vol. 42(3), pages 726-738.
    2. Giovanni Cerulli, 2012. "Ivtreatreg: a new STATA routine for estimating binary treatment models with heterogeneous response to treatment under observable and unobservable selection," CERIS Working Paper 201203, CNR-IRCrES Research Institute on Sustainable Economic Growth - Torino (TO) ITALY - former Institute for Economic Research on Firms and Growth - Moncalieri (TO) ITALY.
    3. Harald Oberhofer, 2013. "Employment Effects of Acquisitions: Evidence from Acquired European Firms," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 42(3), pages 345-363, May.
    4. Giovanni Cerulli, 2011. "ivtreatreg: A new Stata command for estimating binary treatment models with heterogeneous response to treatment under observable and unobservable selection," Italian Stata Users' Group Meetings 2011 04, Stata Users Group.
    5. Giovanni Cerulli, 2010. "Modelling and Measuring the Effect of Public Subsidies on Business R&D: A Critical Review of the Econometric Literature," The Economic Record, The Economic Society of Australia, vol. 86(274), pages 421-449, September.
    6. Egger, Peter & Hahn, Franz R., 2010. "Endogenous bank mergers and their impact on banking performance: Some evidence from Austria," International Journal of Industrial Organization, Elsevier, vol. 28(2), pages 155-166, March.
    7. Foliano, Francesca & Tonei, Valentina & Sevilla, Almudena, 2024. "Social restrictions, leisure and well-being," Labour Economics, Elsevier, vol. 87(C).
    8. Mekonnen, Daniel Ayalew & Gerber, Nicolas & Matz, Julia Anna, 2018. "Gendered Social Networks, Agricultural Innovations, and Farm Productivity in Ethiopia," World Development, Elsevier, vol. 105(C), pages 321-335.
    9. Alexander Hijzen & Sébastien Jean & Thierry Mayer, 2011. "The effects at home of initiating production abroad: evidence from matched French firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(3), pages 457-483, September.
    10. Jan Fałkowski & Maciej Jakubowski & Paweł Strawiński, 2014. "Returns from income strategies in rural Poland," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 22(1), pages 139-178, January.
    11. Langyintuo, Augustine S. & Mungoma, Catherine, 2008. "The effect of household wealth on the adoption of improved maize varieties in Zambia," Food Policy, Elsevier, vol. 33(6), pages 550-559, December.
    12. Annette Bergemann & Marco Caliendo & Gerard J. van den Berg & Klaus F. Zimmermann, 2011. "The threat effect of participation in active labor market programs on job search behavior of migrants in Germany," International Journal of Manpower, Emerald Group Publishing Limited, vol. 32(7), pages 777-795, October.
    13. Li, Linjie & Liu, Xiaming & Yuan, Dong & Yu, Miaojie, 2017. "Does outward FDI generate higher productivity for emerging economy MNEs? – Micro-level evidence from Chinese manufacturing firms," International Business Review, Elsevier, vol. 26(5), pages 839-854.
    14. Carrieri, Vincenzo & Madio, Leonardo & Principe, Francesco, 2019. "Light cannabis and organized crime: Evidence from (unintended) liberalization in Italy," European Economic Review, Elsevier, vol. 113(C), pages 63-76.
    15. Magda Iga & Kiełczewska Aneta & Brandt Nicola, 2020. "The effect of child benefit on female labor supply," IZA Journal of Labor Policy, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 10(1), pages 1-18, March.
    16. Joyous S. Tata & Paul E. McNamara, 2016. "Social Factors That Influence Use of ICT in Agricultural Extension in Southern Africa," Agriculture, MDPI, vol. 6(2), pages 1-10, April.
    17. Michael Pfaffermayr & Michael Wild & Christian Bellak, 2005. "Effekte ausländischer Übernahmen," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 31(1), pages 113-124.
    18. Cain Polidano & Justin van de Ven & Sarah Voitchovsky, 2017. "The Power of Self-Interest: Effects of Education and Training Entitlements in Later-Life," Melbourne Institute Working Paper Series wp2017n12, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    19. Marusca De Castris & Guido Pellegrini, 2015. "Neighborhood Effects On The Propensity Score Matching," Working Papers 0515, CREI Università degli Studi Roma Tre, revised 2015.
    20. Marco Caliendo & Stefan Tübbicke, 2020. "New evidence on long-term effects of start-up subsidies: matching estimates and their robustness," Empirical Economics, Springer, vol. 59(4), pages 1605-1631, October.

    More about this item

    Keywords

    Agricultural Finance;

    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:ags:cmpart:157595. 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: AgEcon Search (email available below). General contact details of provider: http://www.agriculturaleconomics.net .

    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.