Philanthropy Action

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Sep 06, 2009

Interview: IPA Project Director Nathanael Goldberg Talks About the Impacts of Microfinance

“When we compare participants in microfinance programs to non-participants we have to ask what that comparison means. It would be easy to say, ‘Oh, well look, they are better off, so microfinance is great.‘ The problem is we don’t know what type of person is joining a microfinance program. If we think they are either more motivated to improve their lives or they have more resources at their disposal to find out about the program, or they have a good business idea, or they are more likely to get approved by the program – all these types of things might lead us to believe that the kinds of people who participate might be better off anyway, with or without microcredit.  So that means if we see people doing better in those earlier studies compared to non-participants we are not exactly sure whether that is saying something about the program itself or the people who participate in it.“