Many risks are present in rural developing economies: illness, weather, the sudden need to finance an investment opportunity, etc. Yet for many households in rural developing economies, consumption and investment are insured against short-term, idiosyncratic risks to a large extent, despite limited availability...

This paper evaluates the short-term impact of Thailand's Million Baht Village Fund program, among the largest scale government microfinance initiative in the world, using pre- and post-program panel data and quasi-experimental cross-village variation in credit-per-household. Kaboski and Townsend...

A nation’s economic geography can have an enormous impact on its development. This paper shows that for Thailand, a high concentration of enterprise in an area predicts high subsequent growth in and around that area. Felkner and Townsend also find spatially contiguous convergence of enterprise with stagnant...

Kaboski and Townsend use a structural model to understand, predict, and evaluate the impact of an exogenous microcredit intervention program, the Thai Million Baht Village Fund. They model household decisions in the face of borrowing constraints, income uncertainty, and high-yield indivisible investment...

Townsend and Pawasutipaisit use detailed income, balance sheet, and cash flow statements constructed for households in a long monthly panel in an emerging market economy, as well as contributions in economic theory, to document and better understand the factors underlying success in achieving upward...

Several studies report interest rate elasticities for money demand below one half, the value predicted by economic models. It is also widely documented that money holdings decrease as new technologies to economize in the use of cash are introduced. This paper develops a dynamic inventory model for cash...

Theories rationalizing joint liability lending are rich in implications for repayment rates; this paper exploits this fact to test four diverse models. Ahlin and Townsend show that the models’ repayment implications do not always coincide. For example, higher correlation of output and borrowers’ ability...