File2-page122 - Burgess & Pande (2003) Credit and...

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Unformatted text preview: Burgess & Pande (2003) Credit and Microfinance Rural poverty Urban poverty Andhra Pradesh Assam Bihar Gujarat Haryana Jammu & Kashmir Karnataka Kerala Madhya Pradesh Maharashtra Orissa Punjab Rajasthan Tamil Nadu Uttar Pradesh West Bengal 90 70 50 30 10 Poverty headcount 90 70 50 30 10 90 70 50 30 10 90 70 50 30 10 1960 1980 2000 1960 1980 2000 1960 1980 2000 1960 1980 2000 year Figure 5: Poverty in Indian states: 1958-2000 Between bank nationalization in 1969 and financial liberalization in 1990, over 30,000 bank branches opened in rural, un-banked locations These type of state-led banking interventions commonplace post WorldWar II but very limited evaluation of their impact on economic development Positive view: – access to bank pre-requisite for structural change and industrialization (Gerschenkron (1962)) – access to credit necessary to promote occupational diversification (Banerjee and Newman ,1993) Negative view: – cheap credit stunts development of private credit markets and undermines rural development (Adams et al, 1983) – state ownership and control of banks retards financial development and Development Economics, LSE Summer School 2007 119 ...
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This note was uploaded on 12/29/2011 for the course ECO 307 taught by Professor Dublin during the Spring '10 term at SUNY Stony Brook.

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