Banking on the Poor? Branch Location and Nonfarm Rural Development in Bangladesh

Posted: 10 Aug 2000

Abstract

The geographic location of banks' branches is used to test whether they are responding to unexploited gains from nonfarm rural development in Bangladesh. The branch locations of Bangladesh's Grameen Bank are compared with those of traditional banks. The potential gains from switching out of farming are measured, allowing for heterogeneity in household characteristics conducive to success in nonfarm activities. It is found that many farmers are poorly equipped for success in nonfarm enterprises. Even so, seemingly feasible but unrealized gains from switching are revealed. Grameen Bank is attracted to areas where those gains favor the poor. Other banks appear to put higher weight on gains to those other than the poor.

JEL Classification: G21, O15, O53

Suggested Citation

Ravallion, Martin and Wodon, Quentin T., Banking on the Poor? Branch Location and Nonfarm Rural Development in Bangladesh. Available at SSRN: https://ssrn.com/abstract=237055

Martin Ravallion (Contact Author)

Georgetown University ( email )

Washington, DC 20057
United States

Quentin T. Wodon

World Bank ( email )

1818 H Street NW
Washington, DC 20433
United States
202-473-1446 (Phone)
202-522-0054 (Fax)

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