Title
Determinants of household access to formal credit in the rural areas of the Mekong Delta, Vietnam Determinants of household access to formal credit in the rural areas of the Mekong Delta, Vietnam
Author
Faculty/Department
Faculty of Sciences. Bioscience Engineering
Publication type
article
Publication
Leiden ,
Subject
Economics
Source (journal)
African and Asian studies. - Leiden
Volume/pages
11(2012) :3 , p. 261-287
ISSN
1569-2094
ISI
000309308200001
Carrier
E
Target language
English (eng)
Full text (Publishers DOI)
Affiliation
University of Antwerp
Abstract
This paper investigates the factors affecting the access of rural individual and group-based households to formal credit in the Mekong Delta (MD), Vietnam. Poverty levels in the Mekong Delta have reduced significantly over the last decades, but in the rural areas they remain significant. If it is assumed that access to credit is a vehicle for poverty alleviation, it is necessary to assess how households decide on borrowing. This paper identifies the determinants of the decision to borrow and of the amount that is borrowed by using the double hurdle model and Heckman selection model. Data used in this paper was obtained from a survey of 325 rural households, conducted between May and October 2009. The results indicate that household's capital endowments, marital status, family size, distance to the market center, and locations affect the probability to ask for and amount of credit.
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