Empowerment of Microcredit Participants and its Spillover Effects: Evidence from the Grameen Bank of Bangladesh
This paper analyzes the Grameen Bank's non-income impacts pertaining to participants' socio-economic development. It assesses if the accomplished empowerment of the microcredit borrower remains limited only to economic activities or is also reflected in non-economic activities. Study results reveal that participation in the Grameen Bank changes parental preference for male children. It provides insights about how the Grameen Bank and other microcredit programs contribute to the reduction of fertility rates in Bangladesh. Findings include:
- Grameen Bank helps its participants graduate from a passive recipient of credit to an active agent of economic and social process;
- Rural women learn to cope with information and communication systems through their participation in Grameen Bank programs;
- Such involvement enhances their self-confidence, and emboldens them to participate in non-economic events;
- Likelihood of voluntary participation in non-economic events increase with the length of association with the Grameen Bank;
- Grameen Bank also makes society more receptive to change.
The spillover effects of individual empowerment are evident from society's acceptance of the Grameen participants' attitudinal changes. All these changes set up an encouraging environment to increase the efficacy of public policies at reduced costs.
