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WP202305-Labeled-loans-and-human-capital-investments.pdf
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Imperfect capital markets and commitment problems impede lumpy human capital investments. Labeled loans have been postulated as a potential solution to both constraints, but little is known about the role of the label in influencing investment choices in practice. We draw on a cluster randomized controlled trial in rural India to test predictions from a theoretical model, providing novel evidence that labeled microcredit is effective in influencing household borrowing and investment decisions and increasing take-up of a lumpy human capital investment, a toilet.
Authors
![Britta Augsburg](/sites/default/files/styles/square_desktop/public/2022-06/Britta_Augsburg.jpg?itok=xID4yUz7)
Associate Director
Britta is an IFS Associate Director, Associate Staff at the Department of Economics at the UC and Researcher at NIHR Obesity Policy Research Unit.
![Bet Caeyers](/sites/default/files/styles/square_desktop/public/2022-07/Bet%20Caeyers.jpg?itok=bwNU4I_c)
Research Associate Yale University, Stockholm University and FAIR/Norwegian School of Economics (NHH)
Bet is a Research Associate of the IFS who is an Adjunct Associate Professor at FAIR/Norwegian School of Economics (NHH).
![Person graphic](/sites/default/files/styles/square_desktop/public/2022-06/IFS-person-graphic.png?itok=hWCtTSrz)
Sara Giunti
![Bansi Malde](/sites/default/files/styles/square_desktop/public/2023-11/Bansi%20Malde.jpg?itok=WUW9ECXS)
Research Fellow University of Kent
Bansi is a Research Fellow of the IFS, a Senior Lecturer of Economics at the University of Kent and also a Fellow at the Global Labor Organisation.
![Person graphic](/sites/default/files/styles/square_desktop/public/2022-06/IFS-person-graphic.png?itok=hWCtTSrz)
Susanna Smets
Working Paper details
- DOI
- 10.1920/wp.ifs.2023.0523
- Publisher
- Institute for Fiscal Studies
Suggested citation
Augsburg, B et al. (2023). Labeled loans and human capital investments. 23/05. London: Institute for Fiscal Studies. Available at: https://ifs.org.uk/publications/labeled-loans-and-human-capital-investments (accessed: 30 June 2024).
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