Impact of Integrated Programmes for Households Consumption Expenditure: Empirical Evidence from Northern Ethiopia

Fekadu Nigussie Deresse¹ and Germán Guido Calfat²

1. Japan International Cooperation Agency (JICA)
2. University Antwerp, Institute of Development Policy and Management (IOB)

Abstract: We examine factors that drive households’ decision to participate in Village Saving and Loan Association (VSLA), driving forces that determine consumption expenditure, and evaluate the impact of integrated programmes on households’ consumption expenditure. Endogenous switching regression model is fitted to account for the heterogeneity in the decision to participate or not, and for unobserved characteristics of households. Saving, borrowing and asset holdings are the main drivers behind participation in VSLA. Participant’s consumption expenditure is positively and significantly determined by asset holdings, income, male-headedness of the household and highland dwellers; while for non-participant’s labour and income are significant and positive determinants. Participation in the integrated programmes increases consumption expenditure, and participated households benefit the most even the non-participated were to participate.

Keywords: Endogenous switching regression, Integrate Programmes, Heterogeneity, Village Saving and Loan Association, Ethiopia.

Pages: 265 – 284 | Full PDF Paper