Abstract

Increasing efforts aim at economic development and the reduction of poverty through microcredit- enabled entrepreneurship in developing countries. Especially with the award of the Nobel Peace Prize to Prof. Yunus, microcredit lending has risen to prominence and the volume of microcredit loans has increased substantially. However, theory on this financing form is controversial. Further, the academic community lacks conclusive evidence about the impact of such programs. Primary empirical studies report fragmented and to a large extent contradictory results. In this meta-analysis, we empirically synthesize a total of 637 quantitative empirical findings from 97 studies conducted to date to depict whether and how microcredit financing impacts entrepreneurs’ financial well-being and human development. With our findings we contribute to research on the nexus of entrepreneurship in the informal economy and economic development, and offer recommendations for practitioners and academics working on this promising and ambitious frontier.

THE JOURNAL OF SMALL BUSINESS (JSBM) AWARD FOR EXCELLENCE IN RESEARCH ON THE TOPIC OF PUBLIC POLICY

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