Academic journal article American Journal of Entrepreneurship

Microfinance Impact on Poor Rural Women Household-Level Employment: Bargaining Models Approach (the DESCI1 Case: Tigrai State, Northern Ethiopia)

Academic journal article American Journal of Entrepreneurship

Microfinance Impact on Poor Rural Women Household-Level Employment: Bargaining Models Approach (the DESCI1 Case: Tigrai State, Northern Ethiopia)

Article excerpt

INTRODUCTION

Little analytical research has been carried out on microfmance' s impact on poor rural women empowerment using game-theoretic bargaining approach. Many studies lack strong theoretical background, though some have attempted to appraise microfinance's impact on gender or women's empowerment (Kurey, 2005; Terefe, 2002; Wubet, 2006; Borcgrevink, et al, 2005; Bavaiah and Rao, 2006; Haymanot, 2007; WABEKBON, 2006; Fredu, 2006, and Zaid, 2008). Context specific measurement approaches without theoretical foundations have encountered discrepancies (World Bank, 2005) that have created controversies in microfinance and empowerment linkages. Related descriptive studies suggest that women's participation in microfinance has brought about significant impact on their livelihoods, enhanced their household decision making, and improved other direct and indirect outcomes of women's empowerment (WABEKBON, 2006; Haymanot, 2007; Wubet, 2006 and Borcgrevilnk,et al, 2005). Kabeer (2001) and Shetty (2004) identified some reasons for inconsistent findings linking microfinance to women's empowerment: multidimensional concept of empowerment, heterogeneous category of women, time dimension of empowerment and methodological differences (cited in Osmani, 2007). Similarly, the World Bank (2005) identified differential expectations and assessments, the investigator's orientation and emphasis, and contextual differences in the impact of micro credit programs as contributing factors for deviations in outcome assessments. However, diversified studies for program and empowerment linkages as well as the reviews criticizing the weakness of past studies wrapped household bargaining analysis as an alternative approach.

The present study believes household bargaining analysis of a game -theoretic type appropriate analytical tool for program impact analysis on empowerment. In turn, poverty analysis through empowerment, which has remained silent approach, flourishes attention. Neglecting the empowerment aspect of poverty analysis, non-monetary one face of the same coin, resulted most of rural development policies designed and implemented in many developing countries, handed down from one generation to the next, averse a concerted effort to engage individuals and communities towards eradicating poverty through active and prolific participation and the willingness to face up to the root causes of poverty. This is often an outgrowth of historic and contemporary social divisions that cut the poor out of opportunities to share power, equal opportunities and, in the end, hope. But, empowerment approach requires changing beliefs and local institutions both formal and informal that retard development or restrict it from benefiting the poor.

In the midst of empowerment approach to poverty analysis, the diverse aspects of women empowerment either as the outcome of interest or as the intermediary factor touching other development outcomes weakly share common indicators and methods due to lack of supporting theoretical frameworks. However, for studies like the current, using household bargaining analysis and benchmarking the studies in the context of empowerment and gender analysis frameworks increases accuracy of empirical findings and respective inferences. By reducing the discrepancies through keystone theoretical frameworks and using robust estimation strategies, this study assesses Dedebit Credit and Saving Institution (hereafter DECSI) microfinance programme impact on poor rural women empowerment in Tigray region. Specifically, this paper investigates micro credit impact on improving indices of women breakdown position in a household for the implication of women's feeling of powerfulness through generating, owning and controlling household assets by themselves, examines DECSI loan programme interaction with empowerment, via dimensions and levels, enlightens institutional (formal and informal) structures enhancing or hindering women's participation in income-earning activities (strategic life choices). …

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