Offering a unifying theoretical perspective not readily available in any other text, this innovative guide to econometrics uses simple geometrical arguments to develop students' intuitive understanding of basic and advanced topics, emphasizing throughout the practical applications of modern theory and nonlinear techniques of estimation. One theme of the text is the use of artificial regressions for estimation, reference, and specification testing of nonlinear models, including diagnostic tests for parameter constancy, serial correlation, heteroscedasticity, and other types of mis-specification. Explaining how estimates can be obtained and tests can be carried out, the authors go beyond a mere algebraic description to one that can be easily translated into the commands of a standard econometric software package. Covering an unprecedented range of problems with a consistent emphasis on those that arise in applied work, this accessible and coherent guide to the most vital topics in econometrics today is indispensable for advanced students of econometrics and students of statistics interested in regression and related topics. It will also suit practising econometricians who want to update their skills. Flexibly designed to accommodate a variety of course levels, it offers both complete coverage of the basic material and separate chapters on areas of specialized interest.

Estimation and Inference in Econometrics

This paper provides an introduction and "user guide" to Regression Discontinuity (RD) designs for empirical researchers. It presents the basic theory behind the research design, details when RD is likely to be valid or invalid given economic incentives, explains why it is considered a "quasi-experimental" design, and summarizes different ways (with their advantages and disadvantages) of estimating RD designs and the limitations of interpreting these estimates. Concepts are discussed using examples drawn from the growing body of empirical research using RD.

Regression Discontinuity Designs in Economics

This paper provides an introduction and “user guide” to Regression Discontinuity (RD) designs for empirical researchers. It presents the basic theory behind the research design, details when RD is likely to be valid or invalid given economic incentives, explains why it is considered a “quasi-experimental” design, and summarizes different ways (with their advantages and disadvantages) of estimating RD designs and the limitations of interpreting these estimates. Concepts are discussed using examples drawn from the growing body of empirical research using RD. ( JEL C21, C31)

/pdf/regression-discontinuity-designs-in-economics-5foiogfcmd.pdf

Regression discontinuity designs in economics

In the past decade, microfinance programs have demonstrated that it is possible to lend to low-income households while maintaining high repayment rates--even without requiring collateral. The programs promise a revolution in approaches to alleviating poverty and spreading financial services, and millions of poor households are served globally. A growing body of economic theory demonstrates how new contractual forms offer a key to microfinance success--particularly the use of group-lending contracts with joint liability. For the most part, however, high repayment rates have not translated into profits, and studies of impacts on poverty yield a mixed picture. In describing emerging tensions, the paper highlights the diversity of innovative mechanisms beyond group-lending contracts, the measurement of financial sustainability, the estimation of economic and social impacts, the costs and benefits of subsidization, and the potential to reduce poverty through savings programs rather than just credit. The promise of microfinance has pushed far ahead of the evidence, and an agenda is put forward for addressing critical empirical gaps and sharpening the terms of policy discussion.

/pdf/the-microfinance-promise-2e7oe4nvse.pdf

The microfinance promise

This chapter discusses leading problems linked to energy that the world is now confronting and to propose some ideas concerning possible solutions. Oil deserves special attention among all energy sources. Since the beginning of 1981, it has merely been continuing and enhancing the downward movement in consumption and prices caused by excessive rises, especially for light crudes such as those from Africa, and the slowing down of worldwide economic growth. Densely-populated oil-producing countries need to produce to live, to pay for their food and their equipment. If the economic growth of the industrialized countries were to be 4%, even if investment in the rational use of energy were pushed to the limit and the development of nonpetroleum energy sources were also pursued actively, it would be extremely difficult to prevent a sharp rise in prices. It is evident that it is absolutely necessary to pursue actively the development of coal, natural gas, and nuclear power if a physical shortage of energy is not to block economic growth.

World energy outlook

This paper estimates the impact of participation, by gender, in the Grameen Bank and two other group-based micro credit programs in Bangladesh on labor supply, schooling, household expenditure, and assets. The empirical method uses a quasi-experimental survey design to correct for the bias from unobserved individual and village-level heterogeneity. We find that program credit has a larger effect on the behavior of poor households in Bangladesh when women are the program participants. For example, annual household consumption expenditure increases 18 taka for every 100 additional taka borrowed by women from these credit programs, compared with 11 taka for men.

/pdf/the-impact-of-group-based-credit-programs-on-poor-households-39j6sola58.pdf

The Impact of Group-Based Credit Programs on Poor Households in Bangladesh: Does the Gender of Participants Matter?

Micro-finance supports mainly informal activities that often have low market demand. It may be thus hypothesized that the aggregate poverty impact of micro-finance in an economy with low economic growth is modest or nonexistent. The observed borrower-level poverty impact is then a result of income redistribution or short-run income generation. The author addresses these questions using household level panel data from Bangladesh. The findings confirm that micro-finance benefits the poorest and has sustained impact in reducing poverty among program participants. It also has positive spillover impact, reducing poverty at the village level. But the effect is more pronounced in reducing extreme rather than moderate poverty.

Microfinance and poverty - evidence using panel data from Bangladesh

This book reviews quantitative methods and models of impact evaluation. The formal literature on impact evaluation methods and practices is large, with a few useful overviews. Yet there is a need to put the theory into practice in a hands-on fashion for practitioners. This book also details challenges and goals in other realms of evaluation, including monitoring and evaluation (M&E), operational evaluation, and mixed-methods approaches combining quantitative and qualitative analyses. This book is organized as follows. Chapter two reviews the basic issues pertaining to an evaluation of an intervention to reach certain targets and goals. It distinguishes impact evaluation from related concepts such as M&E, operational evaluation, qualitative versus quantitative evaluation, and ex-ante versus ex post impact evaluation. Chapter three focuses on the experimental design of an impact evaluation, discussing its strengths and shortcomings. Various non-experimental methods exist as well, each of which are discussed in turn through chapters four to seven. Chapter four examines matching methods, including the propensity score matching technique. Chapter five deal with double-difference methods in the context of panel data, which relax some of the assumptions on the potential sources of selection bias. Chapter six reviews the instrumental variable method, which further relaxes assumptions on self-selection. Chapter seven examines regression discontinuity and pipeline methods, which exploit the design of the program itself as potential sources of identification of program impacts. Specifically, chapter eight presents a discussion of how distributional impacts of programs can be measured, including new techniques related to quantile regression. Chapter nine discusses structural approaches to program evaluation, including economic models that can lay the groundwork for estimating direct and indirect effects of a program. Finally, chapter ten discusses the strengths and weaknesses of experimental and non-experimental methods and also highlights the usefulness of impact evaluation tools in policy making.

Handbook on Impact Evaluation: Quantitative Methods and Practices

/pdf/microfinance-and-poverty-evidence-using-panel-data-from-2n0z42mk7k.pdf

Microfinance and poverty : evidence using panel data from Bangladesh

Providing microcredit to the poor has become an important antipoverty scheme in many countries. Microcredit helps the poor become self-employed and thus generates income and reduces poverty. In Bangladesh, these programs reach about 5 million poor households. This books attempts to find out whether these programs cost-effective, drawing on the experiences of the well-known microcredit programs of Bangladesh's Grameen Bank, the Rural Development-12 projects, and the Bangladesh Rural Advancement Committee. It examines the cost-effectiveness of microcredit programs vis-�vis other antipoverty programs, such as Food-for-Work. Moreover, the book uses extensive household survey data to address how the gender of participants affects the impact of microcredit programs.

Shahidur R. Khandker

Papers

The Impact of Group-Based Credit Programs on Poor Households in Bangladesh: Does the Gender of Participants Matter?

Microfinance and poverty - evidence using panel data from Bangladesh

Handbook on Impact Evaluation: Quantitative Methods and Practices

Microfinance and poverty : evidence using panel data from Bangladesh

Fighting poverty with microcredit : experience in Bangladesh