africa

Yale Center for the Study of Globalization
Figure 28.5: Malian Case Study: Annual Farm Profits of Families with Grants
Farm profits in the control group were US$330 on average. But the profits of the
families who received our grants in no-loan villages went up by more than 10 percent,
to more than US370. This result is highly statistically significant. Why did their
profits go up? They used a lot more fertilizer. They bought fertilizer, they bought
seed, they hired more labor, and they used tractors a little bit more. Their increases
in profits stemming from the grants persisted for at least two years. These people
then were not lying when they said that they were not using fertilizer because they
didn’t have money. They really wanted to intensify their production, and they did so
as soon as they received money. These findings imply that the average farm family
in Mali, if it could receive grants, would see its profits go way up.
But here is the really interesting part: among the families who had chosen not to
borrow from the MFI but had received our grants (Figure 28.5, column 3), the grants
made virtually no impact on farm profits.
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