Households access to informal rural credit an analysis from VHLSS 2008

UNIVERSITY OF ECONOMICS INSTITUTE OF SOCIAL STUDIES HO CHI MINH CITY THE HAGUE VIETNAM THE NETHERLANDS VIETNAM - NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS HOUSEHOLD ACCESS TO INFORMAL RURAL CREDIT: AN ANALYSIS FROM VHLSS 2008 By LE ANH THU MASTER OF ARTS IN DEVELOPMENT ECONOMICS HO CHI MINH CITY, August 2012 UNIVERSITY OF ECONOMICS INSTITUTE OF SOCIAL STUDIES HO CHI MINH CITY THE HAGUE VIETNAM THE NETHERLANDS VIETNAM - NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS HOUSEHOLD ACCESS TO INFORMAL RURAL CREDIT: AN ANALYSIS FROM VHLSS 2008 A thesis submitted in partial fulfilment of the requirements for the degree of MASTER OF ARTS IN DEVELOPMENT ECONOMICS By LE ANH THU Academic supervisor: Dr LE VAN CHON HO CHI MINH CITY, August 2012 ACKNOWLEDGEMENT This thesis would not have been accomplished without the kind assistance and enthusiastic guidance of several individuals who have in one way or another contributed toward to the formation and fulfillment of this paper First of all, I would like to express my utmost gratitude to Dr Nguyen Trong Hoai and Dr Pham Khanh Nam for sharing their practical profound insights and steadfast encouragement in term of theoretical literature and techniques that are helpful to this study I would like to express my special thanks to Dr Tran Tien Khai and Dr Ha Thuc Vien who have inspired initiatives and passion of rural credit in me to carry out this interesting study I would like to express my deep and sincere gratitude to Dr Le Van Chon for his scientific guidance, patient encouragement and invaluable advice, which he has provided throughout the time of preparation and accomplishment of this paper I sincerely would like to thank all my loved classmates in class MDE17 and staff in the VNP office, who always give me their restless assistance when I was in trouble; especially Nguyen Thi Thuy Thanh, Dinh Thi Thu and Phan Thach Truc for creating motivation for me due to their brilliant talent I would like to express my special massive thanks to my bosses MA Nguyen Duc The and Mrs Van Thi Le who have given me opportunities and spiritual assistance to accomplish this study Last but not least, I must express my most gratitude to my parents and my wife, Bui Thi Thanh Thuy, for their enduring understanding and spiritual assistance which help me overcome the hard times [i] ABSTRACT It is said that credit is the essential source to finance production and consumption expenditures in rural provinces in Vietnam It also plays a critical role in poverty alleviation, livelihood diversification and in reducing household vulnerability Although credit contributes substantially to the rural development, household access to credit sources has not been given proper attention The purpose of this paper is to examine household access to informal financial markets in Vietnamese rural areas It applies the theoretical framework of asymmetric information to investigate the rural credit markets in Vietnam This paper explores determinants that influence loan amounts borrowed by rural households from the informal sources using the Heckman two-step model and the data in the Vietnam Household Living Standard Survey which was carried out in the year 2008 It is found that household expenditure, household assets and number of working earners strongly and positively impacts on probability of credit access; gender of household head highly negatively influence credit accessibility Notwithstanding, informal loan appears almost in household’s activities for both consumption and production purposes, they still mainly rely on relationship of friends and relatives rather than fully make use of informal credit institutions and other sources Key words: Informal rural credit; cross section; Heckman model; VHLSS 2008; Vietnam [ ii ] TABLE OF CONTENTS ACKNOWLEDGEMENT i ABSTRACT ii CHAPTER 1: INTRODUCTION 1.1 Problem statement 1.2 Research objectives 1.3 Research questions 1.4 Justification of the thesis 1.5 Organization of the thesis CHAPTER 2: LITERATURE REVIEW 2.1 History and origin of the rural credit 2.2 Theoretical review of rural credit markets 2.2.1 The theory of monopoly 2.2.2 Asymmetric Information 2.2.3 Indirect screening mechanism 2.2.4 Direct screening mechanism 10 2.3 Empirical studies 11 2.4 Conceptual framework 19 2.5 Chapter summary 22 CHAPTER 3: DATA AND RESEARCH METHODOLOGY 24 3.1 Background of rural credit markets in Vietnam 24 3.2 Data 28 3.3 Research methodology 29 3.3.1 Descriptive analysis 29 3.3.2 Econometric model 29 3.4 Chapter summary 32 CHAPTER 4: ANALYSIS RESULTS 34 4.1 Rural credit markets 34 4.2 Intention of loans 35 4.3 Different loan amounts analysis 36 4.4 Descriptive statistical analyses 38 4.4.1 Univariate analysis 38 [ iii ] 4.4.2 Bivariate analysis 39 4.4.2.1 The nexus of loan amount and age of household head 40 4.4.2.2 The nexus of loan amount and gender of household head 41 4.4.2.3 The nexus of loan amount and education of house head 41 4.4.2.4 The nexus of average loan amount and number of dependents 42 4.4.2.5 The nexus of average loan amount and number of adults 43 4.4.2.6 The nexus of average loan amount and expenditure 44 4.4.2.7 The nexus of loan amount and total value of asset 44 4.4.2.8 The nexus of average loan amount and expense on livestock 45 4.4.2.9 The nexus of average loan amount and cultivated areas 46 4.5 Empirical results 47 4.6 Chapter summary 51 CHAPTER 5: CONCLUSIONS & POLICY IMPLICATIONS 53 5.1 Conclusions 53 5.2 Policy implications 54 5.3 Limitations and directions for further studies 55 5.3.1 Limitations 55 5.3.2 Directions for further studies 55 REFERENCES 57 APPENDICES 60 [ iv ] LIST OF TABLE Table 2.1: Early empirical studies on rural credit 15 Table 3.1: Sample size by region 22 Table 3.2: List of variables 32 Table 4.1: Status of household’s access to rural credit markets 34 Table 4.2: Loan distribution over financial sources 35 Table 4.3: Loan distribution over loan intention 36 Table 4.4: Different amount of loan on rural markets 37 Table 4.5: Different loan amount on the informal sector 38 Table 4.6: Univariate analysis 39 Table 4.7: The Heckman two-step model for informal loan amount 47 [v] LIST OF FIGURES Figure 2.1: The vicious circle of poverty Figure 2.2: Unorganized financial markets in LDCs Figure 2.3: Monopoly & competitive markets Figure 3.1: Rural loan in the formal sector 25 Figure 3.2: Rural loan in the semi-formal sector 26 Figure 3.3: Rural loan in the informal sector 27 Figure 3.4: Sample size 29 Figure 4.1: Gender of household heads 39 Figure 4.2: The nexus of average loan amount and age of household head 40 Figure 4.3: The nexus of average loan amount and gender of household head 41 Figure 4.4: The nexus of loan amount and education of household head 42 Figure 4.5: The nexus of average loan amount and number of dependents 43 Figure 4.6: The nexus of average loan amount and number of adults 43 Figure 4.7: The nexus of average loan amount and expenditure 44 Figure 4.8: The nexus of loan amount and total value of asset 45 Figure 4.9: The nexus of loan amount and expense on livestock 45 Figure 4.10: The nexus of loan amount and cultivated areas 46 [ vi ] ABBREVIATION CCF: The Central Credit Fund LDCs: Less developed countries GSO: The General Statistics Office of Vietnam HH: Household ROSCAs: Rotating Savings and Credits Associations OLS: Ordinary Least Squares PCFs: The People’s Credit Funds SBV: The State Bank of Vietnam VBARD: The Vietnam Bank of Agriculture and Rural Development VBP: The Vietnam Bank for the Poor (formerly) VBSP: Vietnam Bank for Social Policies VFA: The Vietnamese Farmers’ Association VHLSS: Vietnam Household Living Standard Survey VWU: The Vietnamese Women’s Union WB: The World Bank [ vii ] CHAPTER 1: INTRODUCTION 1.1 Problem statement The absence of formal credit sources for the rural household is a critical constraint to agricultural development in many developing countries It is due to information asymmetry in the relationship of lenders and borrowers leading to problems of adverse selection and moral hazard (Stiglitz & Weiss, 1981), (Jung, 2000); the consequence is often that the rural lending is perceptibly undetermined Moreover the imperfect information appears in many government policies supporting credit for rural households The formal credit does not satisfy demand for financing projects or expenditure (George & James, 2010) In addition, formal institutions respond late to small loan amount (Lipton, 1976) Therefore, borrowers seek credit in the informal sector (private moneylender, parents, relatives, friends, etc.) to satisfy their production and consumption (Pham & Izumida, 2002), Mpuga (2010) The poor household in rural areas inevitably relies mainly on the expensive informal credit to finance their production, expenditure, tuition fee, wedding, funeral etc; for that reason informal credit plays a crucial role in rural development with evidences from (Adams & Graham, 1981), (George & James, 2010) The operations of informal financial sectors are concerned with many diversified aspects including the supply of rural formal credit market is not able to satisfy the growing demand of rural households and many borrowers turn to informal credit markets for their production and consumption needs (Takashi, 2009); almost characteristics of the rural farm households are risky and uncertainty, usually dealing with small scale of debt, while the supply of the formal sector often concentrates on large scale projects (Barslund & Tarp, 2008), (Takashi, 2009); transaction cost of the formal credit is higher than the cost implied so informal lenders provide financial services with the competitive cost (Adams & Graham, 1981), (Guirkinger, 2008), (Mpuga, 2010) [1] Okurut, F.N et al (2005) Credit demand and credit rationing in the informal financial sector in Uganda South African Journal of Economics, 73(3), 482497 Pham, B.D., & Izumida, Y (2002) Rural development Finance in Vietnam: A micro econometric analysis of household surveys World Development, 30(2), 319-335 Shete, M., & Garcia R.J (2011) Agricultural credit market participation in Finoteselam town, Ethiopia Journal of Agribusiness in Developing and Emerging Economies, 1(1), 55-74, doi:10.1108/20440831111131514 Stiglitz, J.E., & Weiss, A (1981) Credit rationing in markets with imperfect information The American Economic Review, 71(3), 393-410 Takashi, O (2009) Rural credit and community relationships in a Northern Vietnamese village Southeast Asian Studies, 47(1), 3-30 Tran, T.D (1998) Analysis of the Informal Credit Sector in Vietnam Retrieved March 20, 2012, from http://www.gdrc.org/icm/viet-dat_tran.html [ 59 ] APPENDICES Appendix 1: Questionaire is used in VHLSS 2008 Variable Question Measure Age, adult, i) How old are you? dependent, ii) What is the relationship to head of household? gender Education Which grade has you finished? Years of schooling Asset What is the value of money of assets/durable things VND thousand that you bought in the last 12 months? Expenditure What is the money value of food/stuff/others that VND thousand your household purchased or bartered for in the last 12 months? Land size What is the total cultivated area in the last 12 Square meter months? (rice cultivation, annual crops, perennial plants, fruit trees and others) Livestock What is the money value of raising costs in the last VND thousand 12 months? Loan amount i) Have you been provided with loan in the last 12 months? ii) What is the value of loan in the last 12 month? iii) What is the source of the loan? iv) What is the term of the loan? [ 60 ] VND thousand Appendix 2: Source of data in VHLSS 2008 Order Variable Filename Item Age muc123a.dta m1ac5 Gender muc123a.dta m1ac2 Education muc123a.dta m2ac1 Dependent Age ≤ 14 or Age ≥ 65 Adult Age ≥ 15 and Age ≤ 64 Livestock muc4b22.dta m4b22c18, m4b22ma, m4b22c18 Land size muc4b11.dta (rice cultivation m4b11c3 area) m4b12c3, m4b12c3b muc4b1234 (cultivated areas of annual crops, perennial plants, fruit trees and others) Expenditure muc5a1.dta (holiday m5a1c2b+m5a1c3b consumption) m5a2c6+m5a2c10 muc5a2.dta (annual m5b1c4+m5b1c5 consumption) m5b2c2+m5b2c3 muc5b1.dta (other consumption) m5b3c2 muc5b2.dta (other consumption) muc5b3.dta (other consumption) 10 Asset Informal loan muc6a.dta (fixed asset) m6ac5*m6ac7 muc6b.dta (durable asset) m6bc5 muc82.dta m8c8, m8c10a, amount m8c13 [ 61 ] Appendix 3: Accessibility of households in Vietnamese informal rural financial markets Access to informal Not access to markets informal markets Total Region Sample size Sample % size Sample % size % Red River Delta 270 24.5 949 25.4 1219 25.2 Northeast 167 15.1 501 13.4 668 13.8 Northwest 56 5.1 187 5.0 243 5.0 North Central Coast 158 14.3 446 11.9 604 12.5 South Central Coast 61 5.5 382 10.2 443 9.2 Central Highlands 103 9.3 158 4.2 261 5.4 Southeast 88 8.0 352 9.4 440 9.1 Mekong River Delta 200 18.1 759 20.3 959 19.8 Total 1103 100 3734 100 4837 100 Source: Author’s calculation in VHLSS 2008 Appendix 4: Status of household’s access to credit-1 Number of households Percentage Access to credit 3103 45.4% Not access to credit 3734 54.6% 6837 100% Total Source: Author’s calculation in VHLSS 2008 Appendix 5: Status of household’s access to credit-2 Number of households Access more than one source Access to only one source Total Source: Author’s calculation in VHLSS 2008 [ 62 ] Percentage 475 6.9% 2628 38.4% 3103 70% Appendix 6: Status of household’s access to credit-3 Number of households Access to formal credit Percentage 2082 28.7% 339 4.7% Access to informal credit 1103 15.2% No demand/access to credit 3734 51.4% 7258 100% Access to semi-formal credit Total Source: Author’s calculation in VHLSS 2008 [ 63 ] Appendix 7: The nexus of loan amount and age of household head ≤ 0.5 VND mil 0.5–1 VND mil No of Age HH 1.–5 VND mil No of % HH Amount of loan –10 VND mil No of % 3.23 5.56 ≤ 30 31–40 14 45.16 19 26.39 41–50 6.45 20 27.78 51–60 25.81 14 19.44 > 60 19.35 15 20.83 Total 31 100 72 100 Source: Author’s calculation in VHLSS 2008 HH 35 92 129 86 62 404 No of % HH 8.66 22.77 31.93 21.29 15.35 100 15 72 86 47 30 250 10 –50 VND mil No of % 28.8 34.4 18.8 12 100 No of HH 19 85 86 57 44 291 > 50 VND mil % HH 6.53 29.21 29.55 19.59 15.12 100 No of % 11 25 55 Total 9.09 20.00 45.45 14.55 10.91 100 HH 79 293 348 220 163 1103 % 7.16 26.56 31.55 19.95 14.78 100 Appendix 8: The nexus of loan amount and gender of household head ≤ 0.5 VND mil No of Gender HH % 0.5–1 VND mil No of HH % Female 25.81 16 22.22 Male 23 74.19 56 77.78 Total 31 100 72 100 Source: Author’s calculation in VHLSS 2008 Amount of loan –10 10 –50 VND mil VND mil No of No of 1.–5 VND mil No of HH 79 325 404 % HH 19.55 80.45 100 [ 64 ] % 50 20 200 80 250 100 HH 58 233 291 % 19.93 80.07 100 > 50 VND mil No of HH % 11 44 55 20.00 80.00 100 Total No of HH 222 881 1103 % 20.13 79.87 100 Appendix 9: The nexus of loan amount and education of household head ≤ 0.5 VND mil No of No of HH Education 0.5–1 VND mil % Amount of loan –10 VND mil 1.–5 VND mil No of HH % Illiteracy 9.68 12 Primary 14 45.16 29 Secondary 12 38.71 24 High school 6.45 Total 31 100 72 Source: Author’s calculation in VHLSS 2008 No of HH 16.67 40.28 33.33 9.72 100 % 24 164 184 32 404 No of HH 5.94 40.59 45.54 7.93 100 16 71 129 34 250 10 –50 VND mil % No of HH 6.40 28.40 51.60 13.60 100 > 50 VND mil % 10 79 158 44 291 No of HH 3.44 27.15 54.29 15.12 100 Total % 33 13 55 HH 1.81 14.55 60.00 23.64 100 66 365 540 132 1103 % 5.98 33.09 48.96 11.97 100 Appendix 10: The nexus of loan amount and number of dependents Depen -dants ≤ 0.5 VND mil No of HH % 0.5–1 VND mil No of HH % 22.58 17 23.61 1-2 19 61.29 47 65.28 3-5 12.90 11.11 >5 3.23 0.00 Total 31 100 72 100 Source: Author’s calculation in VHLSS 2008 1.–5 VND mil No of HH 100 237 66 404 % Amount of loan –10 VND mil No of HH 24.75 58.66 16.34 0.25 100 63 143 43 250 [ 65 ] % 25.20 57.20 17.20 0.40 100 10 –50 VND mil No of HH 79 175 37 291 % 27.15 60.14 12.71 0.00 100 > 50 VND mil No of HH % 18 29 55 32.72 52.73 14.55 0.00 100 Total No of HH 284 650 166 1103 % 25.75 58.93 15.05 0.27 100 Appendix 11: The nexus of loan amount and number of adults ≤ 0.5 VND mil No of Adults HH % 0.5–1 VND mil No of HH % 1-2 16.13 18 25.00 3-5 18 58.06 44 61.11 >5 25.81 10 13.89 Total 31 100 72 100 Source: Author’s calculation in VHLSS 2008 1.–5 VND mil No of HH 51 277 76 404 % Amount of loan –10 VND mil No of HH 12.62 68.57 18.81 100 20 172 58 250 % 8.00 68.80 23.20 100 10 –50 VND mil No of HH 29 212 50 291 % > 50 VND mil No of HH 9.97 72.85 17.18 100 % 41 55 9.09 74.55 16.36 100 Total No of HH 128 764 211 1103 % 11.60 69.27 19.13 100 Appendix 12: The nexus of loan amount and expenditure Exp (VND mil) ≤ 0.5 VND mil No of HH % 0.5–1 VND mil No of HH % 16.13 15 20.83 ≤ 10 10.-20 20 64.52 34 47.22 20.-30 12.90 16 22.22 30.-40 6.45 5.56 40.-50 0.00 1.39 50.-100 0.00 2.78 > 100 0.00 0.00 Total 31 100 72 100 Source: Author’s calculation in VHLSS 2008 1.–5 VND mil No of HH 45 208 98 40 404 % Amount of loan –10 VND mil No of HH 11.14 51.49 24.26 9.90 1.72 1.49 0.00 100 13 88 89 39 11 250 [ 66 ] % 5.20 35.20 35.60 15.60 4.40 3.20 0.80 100 10 –50 VND mil No of HH 12 100 87 48 22 20 291 % 4.12 34.36 29.90 16.50 7.56 6.87 0.69 100 > 50 VND mil No of HH % 11 21 10 55 0.00 20.00 38.18 18.18 7.27 12.73 3.64 100 Total No of HH 90 461 315 143 45 43 1103 % 8.16 41.8 28.56 12.96 4.08 3.9 0.54 100 Appendix 13: The nexus of loan amount and total value of asset Assets Amount of loan (VND ≤ 0.5 0.5–1 1.–5 –10 10 –50 > 50 mil) VND mil VND mil VND mil VND mil VND mil VND mil No of No of HH % No of HH % No of HH % No of HH % HH Total No of % No of HH % HH % ≤ 10 17 54.84 36 50.00 158 39.10 57 22.80 43 14.78 3.64 313 28.38 10.-20 29.03 16 22.22 118 29.21 54 21.60 59 20.27 12.73 263 23.84 20.-30 12.90 13 18.06 63 15.59 58 23.20 48 16.49 9.09 191 17.32 30.-40 3.23 6.94 29 7.18 31 12.40 35 12.03 7.27 105 9.52 40.-50 0.00 1.39 14 3.47 13 5.20 29 9.97 9.09 62 5.62 50.-100 0.00 1.39 18 4.46 28 11.20 47 16.15 11 20.00 105 9.52 > 100 0.00 0.00 0.99 3.60 30 10.31 21 38.18 64 5.80 Total 31 100 72 100 404 100 250 100 291 100 55 100 1103 100 Source: Author’s calculation in VHLSS 2008 [ 67 ] Appendix 14: The nexus of loan amount and expense on livestock Livestock expense Amount of loan (VND ≤ 0.5 0.5–1 1.–5 –10 10 –50 > 50 mil) VND mil VND mil VND mil VND mil VND mil VND mil No of No of HH % No of HH % No of HH % No of HH % Total No of HH % No of HH % HH % 10 32.26 19 26.39 137 33.91 77 30.8 106 36.43 20 36.36 369 33.45 ≤ 10 20 64.52 51 70.83 247 61.14 156 62.4 152 52.23 23 41.82 649 58.84 10.-20 3.22 1.39 1.73 3.6 17 5.84 7.27 39 3.54 20.-30 0 0 0.5 0.8 1.72 1.82 10 0.91 30.-40 0 0 1.24 1.2 0.69 1.82 11 1.00 40.-50 0 0 0.74 0.4 1.03 0.00 0.63 > 50 0 1.39 0.74 0.8 2.06 10.91 18 1.63 Total 31 100 72 100 404 100 250 100 291 100 55 100 1103 100 Source: Author’s calculation in VHLSS 2008 [ 68 ] Appendix 15: The nexus of loan amount and cultivated areas Land size (1000m2) ≤ 0.5 0.5–1 VND mil No of HH % VND mil No of HH Amount of loan –10 1.–5 % 29.03 26 36.11 0 0 ≤1 1.-5 12 38.71 20 27.78 >5 10 32.26 26 36.11 Total 31 100 72 100 Source: Author’s calculation in VHLSS 2008 VND mil No of HH 195 89 119 404 VND mil No of % HH 48.27 0.24 22.03 29.46 100 116 45 88 250 % 46.4 0.4 18 35.2 100 10 –50 > 50 VND mil No of HH 157 58 76 291 VND mil No of % 53.95 19.93 26.12 100 HH Total No of % 35 12 55 HH 63.63 1.82 12.73 21.82 100 Appendix 16: Correlation of dependent variable and independent variables (the first time) lnasset lnlandsz age edu 1.0000 lnasset 1.0000 lnlandsz -0.0170 -0.1344 -0.1415 1.0000 age 0.3013 0.0801 -0.2537 1.0000 edu -0.0331 0.0463 -0.0478 -0.1437 dep 0.2082 0.1812 -0.2332 0.0005 adult 0.4979 -0.0331 -0.2162 0.2877 lnexp 0.0648 0.5297 -0.1003 0.1175 lnlstk 0.1415 0.1312 -0.2421 0.2201 gender 0.3534 -0.0494 -0.0989 farming -0.0796 0.6922 -0.0995 0.0209 farmland -0.0125 0.0279 0.3571 -0.0397 0.0432 farmliv Source: Author’s calculation in VHLSS 2008 dep 1.0000 0.5516 0.0744 0.0376 0.0877 0.0082 0.0320 0.0156 adult lnexp 1.0000 0.5117 1.0000 0.1508 0.0335 0.2576 0.2370 0.0624 -0.1148 0.1408 -0.0060 0.0867 -0.0073 [ 69 ] lnlstk 1.0000 0.1535 0.3353 0.2819 0.6497 gender 1.0000 0.0319 0.0668 0.0662 farming farmland farmliv 1.0000 0.1674 0.3222 1.0000 0.4274 1.0000 538 231 331 1103 % 48.78 0.27 20.94 30.01 100 Appendix 17: Correlation of dependent variable and independent variables (the latest time) lnasset lnasset lnage edu dep adult lnexp lnlstk gender farming 1.0000 -0.1344 1.0000 edu 0.3013 -0.2537 1.0000 dep -0.0331 -0.0478 -0.1437 1.0000 adult 0.2082 -0.2332 0.0005 0.5516 1.0000 lnexp 0.4979 -0.2162 0.2877 0.0744 0.5117 1.0000 lnlstk 0.0648 -0.1003 0.1175 0.0376 0.1508 0.0335 1.0000 gender 0.1415 -0.2421 0.2201 0.0877 0.2576 0.2370 0.1535 1.0000 farming -0.0796 -0.0494 -0.0989 0.0082 0.0624 -0.1148 0.3353 0.0319 1.0000 farmland -0.0125 -0.0995 0.0209 0.0320 0.1408 -0.0060 0.2819 0.0668 0.1674 lnage farmland Source: Author’s calculation in VHLSS 2008 [ 70 ] 1.0000 Appendix 18: Ramsey RESET test using powers of the fitted values of lnloansz the Heckman two-stage model in the first time Ho: The new model has no omitted variables Ha: The old model has no omitted variables Result: F(3, 1087) = 14.45 Prob > F = 0.00  Reject Ho Appendix 19: Ramsey RESET test using powers of the fitted values of lnloansz the Heckman two-stage model in the last time Ho: The new model has no omitted variables Ha: The old model has no omitted variables Result: F(3, 1087) = 15.00 Prob > F = 0.00  Reject Ho Appendix 20: Heteroskedasticity test using Breusch-Pagan / Cook-Weisberg - the Heckman two-stage model in the first time Ho: Constant variance Variables: fitted values of lnloansz Result: chi2(1) = 0.21 Prob > chi2 = 0.65  Fail to reject Ho Appendix 21: Heteroskedasticity test using Breusch-Pagan / Cook-Weisberg - the Heckman two-stage model in the last time Ho: Constant variance Variables: fitted values of lnloansz Result: chi2(1) = 0.22 Prob > chi2 = 0.63  Fail to reject Ho [ 71 ] Appendix 22: The regression result of the Heckman two-stage model in the first time Heckman selection model two-step estimates (regression model with sample selection) Number of obs Censored obs Uncensored obs Wald chi2(11) Prob > chi2 Coef lnloansz lnasset (VND1000) lnlandsz (1000m2) age edu dep lnexp (VND1000) lnlstk(VND1000) gender farming farmland farmliv d lnasset (VND1000) lnlandsz (1000m2) age edu dep adult lnexp (VND1000) lnlstk (VND1000) gender farming farmland farmliv mills lambda Std Err Z P>|z| = = = 4837 3734 1103 = = 241.69 0.00 [95% Conf Interval] 0.084 -0.008 -0.014 0.050 -0.037 0.654 0.010 -0.266 -0.136 -0.013 -0.009 0.024 0.006 0.005 0.012 0.032 0.081 0.007 0.103 0.086 0.009 0.010 3.43 -1.29 -2.42 3.95 -1.14 7.99 1.36 -2.57 -1.58 -1.45 -0.90 0.001*** 0.199 0.016** 0.000*** 0.254 0.000*** 0.173 0.010*** 0.114 0.147 0.370 0.036 -0.020 -0 261 0.025 -0.102 0.493 -0.004 -0.469 -0.304 -0.031 -0.029 0.133 0.004 -0.002 0.075 0.026 0.814 0.024 -0.063 0.032 0.004 0.011 -0.029 -0.001 -0.013 0.002 -0.048 0.089 -0.078 0.008 -0.101 -0.015 -0.006 -0.003 0.010 0.003 0.001 0.006 0.021 0.018 0.048 0.003 0.053 0.045 0.004 0.005 -2.76 -0.33 -8.33 0.43 -2.23 4.89 -1.63 2.60 -1.88 -0.33 -1.35 -0.72 0.006*** 0.744 0.000*** 0.665 0.026** 0.000*** 0.104 0.009*** 0.061* 0.743 0.178 0.473 -0.050 -0.007 -0.016 -0.009 -0.090 0.053 -0.173 0.002 -0.206 -0.105 -0.015 -0.014 -0.008 0.005 -0.010 0.015 -0.005 0.125 0.016 0.015 0.004 0.074 0.002 0.006 1.099 0.517 2.13 033** 0.086 2.113 rho 0.740 sigma 1.486 Source: Author’s calculation in VHLSS 2008 Notes: *, **, *** denote 10%, 5%, and 1% level of significance, respectively [ 72 ] Appendix 23: The regression result of the Heckman two-stage model in the last time Heckman selection model two-step estimates (regression model with sample selection) Coef Std Err Z Number of obs Censored obs Uncensored obs = = = 4837 3734 1103 Wald chi2(8) Prob > chi2 = = 252.25 0.00 P>|z| [95% Conf Interval] lnloansz lnasset (VND1000) 0.089 0.023 3.87 0.000*** 0.044 0.134 age -0.012 0.005 -2.48 0.013** -0.022 -0.002 edu 0.050 0.012 4.08 0.000*** 0.026 0.074 dep -0.038 0.031 -1.21 0.226 -0.101 0.023 lnexp (VND1000) 0.664 0.078 8.43 0.000*** 0.509 0.818 gender -0.248 0.097 -2.54 0.011** -0.440 -0.057 farming -0.157 0.076 -2.04 0.041** -0.308 -0.006 farmland -0.021 0.005 -3.68 0.000*** -0.032 -0.009 lnasset (VND1000) -0.029 0.010 -2.77 0.006*** -0.050 -0.008 age -0.013 0.01 -8.36 0.000*** -0.016 -0.10 edu 0.002 0.006 0.42 0.678 -0.009 0.015 dep -0.048 0.021 -2.23 0.026** -0.090 -0.05 adult 0.089 0.018 4.91 0.000*** 0.053 0.125 lnexp (VND1000) -0.077 0.047 -1.61 0.106 -0.171 0.016 lnlstk (VND1000) 0.007 0.002 2.97 0.003*** 0.002 0.011 gender -0.100 0.053 -1.86 0.062* -0.205 0.005 farming -0.023 0.043 -0.54 0.591 -0.109 0.062 farmland -0.008 0.003 -2.59 0.010*** -0.014 -0.002 lambda 0.925 0.424 2.18 029** 0.093 1.757 rho 0.663 sigma 1.394 D mills Source: Author’s calculation in VHLSS 2008 Notes: *, **, *** denote 10%, 5%, and 1% level of significance, respectively [ 73 ] ... THE HAGUE VIETNAM THE NETHERLANDS VIETNAM - NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS HOUSEHOLD ACCESS TO INFORMAL RURAL CREDIT: AN ANALYSIS FROM VHLSS 2008 A thesis submitted in partial... farmers’ access to credit Another view of Mpuga (2010), he employed a panel data analysis of the Uganda household surveys conducted in 1992/1993 and 1999/2000 to study the accessibility to and the... institutions Meanwhile, the distance of formal sector, transaction cost, corruption and bribe tend to move the farmer from formal to informal sector Similarly, Menkhoff and Rungruxsirivorn (2011) analyzed