Ruhr Economic Papers

Ruhr Economic Papers #878

Improving Housing Conditions: Labelled Loans in Kenya and Uganda

by Amreen Choda, Annekathrin Schoofs and Noel Verrinder

RWI, 12/2020, 53 S./p., 10 Euro, ISBN 978-3-96973-017-1 DOI: 10.4419/96973017



We evaluate a non-governmental housing microfinance intervention that attempts to improve housing conditions for low income populations by simultaneously offering them a labelled loan and non-financial technical support. Using household survey data from Kenya and Uganda, we first show evidence for the successful targeting of our labelled loans because 95% of clients used the loan for the intended housing improvement. Second, our results suggest that access to small, short-term loans enables households to invest in housing upgrades that can significantly improve both the characteristics of their dwelling and their satisfaction with their dwelling. These effects are robust to four different estimation approaches (difference-in-differences, inverse probability weighting, matching, and ordinary least squares with postdouble selection Lasso).

JEL-Classification: I15, I31, O18

Keywords: Housing conditions; microfinance; health; Uganda; Kenya