Assessing household wealth in health studies in developing countries: a comparison of participatory wealth ranking and survey techniques from rural South Africa

BACKGROUND: Accurate tools for assessing household wealth are essential for many health studies in developing countries. Household survey and participatory wealth ranking (PWR) are two approaches to generate data for this purpose. METHODS: A household survey and PWR were conducted among eight villages in rural South Africa. We developed three indicators of household wealth using the data. One indicator used PWR data only, one used principal components analysis to combine data from the survey, while the final indicator used survey data combined in a manner informed by the PWR. We assessed internal consistency of the indices and assessed their level of agreement in ranking household wealth. RESULTS: Food security, asset ownership, housing quality and employment were important indicators of household wealth. PWR, consisting of three independent rankings of 9671 households, showed a high level of internal consistency (intraclass correlation coefficient 0.81, 95% CI 0.79-0.82). Data on 1429 households were available from all three techniques. There was moderate agreement in ranking households into wealth tertiles between the two indicators based on survey data (spearman rho = 0.69, kappa = 0.43), but only limited agreement between these techniques and the PWR data (spearman rho = 0.38 and 0.31, kappa = 0.20 and 0.17). CONCLUSION: Both PWR and household survey can provide a rapid assessment of household wealth. Each technique had strengths and weaknesses. Reasons for differences might include data inaccuracies or limitations in the methods by which information was weighted. Alternatively, the techniques may measure different things. More research is needed to increase the validity of measures of socioeconomic position used in health studies in developing countries

Small individual loans and mental health: a randomized controlled trial among South African adults

<p>Abstract</p> <p>Background</p> <p>In the developing world, access to small, individual loans has been variously hailed as a poverty-alleviation tool – in the context of "microcredit" – but has also been criticized as "usury" and harmful to vulnerable borrowers. Prior studies have assessed effects of access to credit on traditional economic outcomes for poor borrowers, but effects on mental health have been largely ignored.</p> <p>Methods</p> <p>Applicants who had previously been rejected (n = 257) for a loan (200% annual percentage rate – APR) from a lender in South Africa were randomly assigned to a "second-look" that encouraged loan officers to approve their applications. This randomized encouragement resulted in 53% of applicants receiving a loan they otherwise would not have received. All subjects were assessed 6–12 months later with questions about demographics, socio-economic status, and two indicators of mental health: the Center for Epidemiologic Studies – Depression Scale (CES-D) and Cohen's Perceived Stress scale. Intent-to-treat analyses were calculated using multinomial probit regressions.</p> <p>Results</p> <p>Randomization into receiving a "second look" for access to credit increased perceived stress in the combined sample of women and men; the findings were stronger among men. Credit access was associated with reduced depressive symptoms in men, but not women.</p> <p>Conclusion</p> <p>Our findings suggest that a mechanism used to reduce the economic stress of extremely poor individuals can have mixed effects on their experiences of psychological stress and depressive symptomatology. Our data support the notion that mental health should be included as a measure of success (or failure) when examining potential tools for poverty alleviation. Further longitudinal research is needed in South Africa and other settings to understand how borrowing at high interest rates affects gender roles and daily life activities. CCT: ISRCTN 10734925</p

Microcredit for self-employed disabled persons in developing countries

Microcredit has become a popular instrument to promote economic empowerment among poor entrepreneurs, and is increasingly being recommended to improve economic rehabilitation among persons with disabilities. However, the majority of the advocates of microcredit for persons with disabilities seem not to be informed on the involved “rules of the game”. At the same time the microfinance community lacks information on disability issues. In this report we aim on closing the gap in knowledge and culture between the disability- and the microfinance communities. We apply resource based theory to analyze when microcredit for disabled persons is an appropriate tool and when it is not. We argue that asymmetric information between microfinance institutions and the disabled population is probably the main hindrance for increased penetration of microcredit services to disabled persons. We recommend disabled entrepreneurs with the necesarry resource base to be included as regular clients in mainstream MFIs or as regular members in self helping microfinance systems like ROSCAs. We provide lists of recommendations that are both easy to understand and to apply for MFIs, DPOs and donors. Due to the lack of theoretical and empirical knowledge available we see this report as a starting point and we advocate for increased research efforts within this field

Exploring New Ways to Assess the Impact of Microfinance: What Role for the Capability Approach?

International audienceAbstractPurposeThe disagreement over the contribution of microfinance to fight poverty is mainly related to the wide range of methodologies used to study it. The aim of this chapter is to reveal the limitations of these methodologies and explore whether the capability approach may improve impact assessment, especially in the microfinance field.Methodology/approachThe author’s contribution is based on a comprehensive literature review of the most cited scholarly studies on microfinance impact.FindingsThis contribution has two main findings: It identifies the characteristics of an impact assessment conceptual framework based on the Capability Approach. It also gives a documented justification on why this approach is an interesting way to evaluate the potential effects of microfinance programs.Originality/valueApplying the capability approach to poverty in microfinance is not new. However, as far as we know this is the first contribution that tries to apply it to the specific issue of impact assessment