Financial Access and Household Welfare

This paper evaluates the impact of
access to credit from banks and other financial institutions
on household welfare in Mauritania. Micro-level data from a
2014 household survey are used to evaluate the relationship
between credit access, a range of household characteristics,
and welfare indicators. To address potential endogeneity
issues, the household isolation level is used to instrument
access to credit. The results show that households headed by
older, more educated people are more likely to access
financial services, as are households located in urban
areas. In addition, greater financial access appears to be
associated with a reduced dependence on household production
and increased investment in human capital.