Credit Constraints, Agricultural Productivity, and Rural Nonfarm Participation : Evidence from Rwanda

Ali, Daniel Ayalew ; Deininger, Klaus ; Duponchel, Marguerite

World Bank, Washington, DC

关键词: ACCESS TO CAPITAL;    ACCESS TO CREDIT;    ACCESS TO INFORMATION;    ADVERSE SELECTION;    AGRICULTURAL COMMODITIES;   

DOI  :  10.1596/1813-9450-6769
RP-ID  :  WPS6769

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Although the potentially negativeimpacts of credit constraints on economic development havelong been discussed conceptually, empirical evidence forAfrica remains limited. This study uses a direct elicitationapproach for a national sample of Rwandan rural householdsto assess empirically the extent and nature of creditrationing in the semi-formal sector and its impact using anendogenous sample separation between credit-constrained andunconstrained households. Being credit constrained reducesthe likelihood of participating in off-farm self-employmentactivities by about 6.3 percent while making participationin low-return farm wage labor more likely. Even withinagriculture, elimination of all types of credit constraintsin the semi-formal sector could increase output by some 17percent. Two suggestions for policy emerge from thefindings. First, the estimates suggest that access toinformation (education, listening to the radio, andmembership in a farm cooperative) has a major impact onreducing the incidence of credit constraints in thesemi-formal credit sector. Expanding access to informationin rural areas thus seems to be one of the most promisingstrategies to improve credit access in the short term.Second, making it easy to identify land owners and transferland could also significantly reduce transaction costsassociated with credit access.