Identification
Survey ID number
MWI_2009_BFI_v01_M
Title
Facilitating Savings for Agriculture: Field Experimental Evidence from Malawi 2009-2010
Country/Economy
| Name |
Country code |
|
Malawi |
MWI |
Study type
Other Household Survey [hh/oth]
Series Information
Agriculture in Sub-Saharan Africa employs two-thirds of the labor force and generates about one-third of GDP growth. According to the 2008 World Development Report, GDP growth originating in agriculture is about four times more effective in reducing poverty than GDP growth originating outside agriculture. For this reason, policies that foster agricultural productivity can have a substantial impact on food security and poverty reduction.
In recent decades, there has been substantial interest among policy-makers, donors, and international development institutions in microfinance (financial services for the poor) as an anti-poverty intervention. Provision of microcredit has perhaps attracted the most attention. In 2009, the Microcredit Summit estimated that there were more than 3,500 microfinance institutions around the world with 150 million clients (Daley-Harris 2009). While these outreach numbers are impressive, microcredit today is largely devoted to non-agricultural activities (Morduch 1999; Armendariz de Aghion and Morduch 2005) due to the substantial challenges inherent in agricultural lending. Given the limited supply of credit for agriculture, many donors and academics (for example, Deaton 1990; Robinson 2001 and more recently the Bill and Melinda Gates Foundation) have emphasized the potential for increasing access to formal savings.
The motivating question of this study is whether facilitating formal savings can promote agricultural development. To this end, the authors collaborated with a bank and private sector firms to implement a randomized controlled trial of a program facilitating formal savings for Malawian cash crop (tobacco) farmers. To authors knowledge, this is the first randomized study of the agricultural impacts of an intervention facilitating savings in a formal banking institution.
Abstract
The survey data accompanies the paper, "Facilitating Savings for Agriculture: Field Experimental Evidence from Malawi,”. The investigators implemented a randomized intervention among Malawian farmers aimed at facilitating formal savings for agricultural inputs. Treated farmers were offered the opportunity to have their cash crop harvest proceeds deposited directly into new bank accounts in their own names, while farmers in the control group were paid harvest proceeds in cash (the status quo). The treatment led to higher savings in the months immediately prior to the next agricultural planting season, and raised agricultural input usage in that season. They also find positive treatment effects on subsequent crop sale proceeds and household expenditures. Because the treatment effect on savings was only a small fraction of the treatment effect on the value of agricultural inputs, mechanisms other than alleviation of savings constraints per se are needed to explain the treatment’s impact on input utilization. Authors discuss other possible mechanisms through which treatment effects may have operated.
Data used in this paper come from two surveys as well as from administrative records of Bank of Malawi (OBM).
Kind of Data
Sample survey data [ssd]
Unit of Analysis
The study describes farmers.
