Microfinance Banks and Household Access to Finance

3. Data and Methodology3.1. Life in Transition Survey and Bank branch dataOur main data source is the EBRD-World Bank Life in Transition Survey (LITS) whichwas conducted in 29 countries in 2006 and 2010 as a repeated cross-sectional survey. In eachcountry, 50 Primary Sampling Units (PSUs) were selected with probability of selectionproportional to PSU size. Then twenty households within each PSU were randomly selected,resulting in roughly 1,000 observations per country. 2 The first part of the interviews wasconducted with the household head and yields information on household composition,housing, expenses and the use of services. For the second part of the survey, a randomlyselected adult household member was interviewed about attitudes and values as well as thepersonal work history, education and entrepreneurial activity. For the purpose of our study,we use information from the first part of the survey to obtain indicators of household use ofbanking services, location, size and income as well as the gender and age of the householdhead. From the second part of the survey, we obtain indicators of education, employmentstatus, religion and ethnicity.We focus our study on four South-Eastern European countries: Albania, Bulgaria,Macedonia and Serbia. For these four countries we augment the LITS survey data withgeographical information on the location of PSUs. We then match the LITS survey data withgeographical information on the branch location of the largest microfinance bank in theregion: ProCredit Bank. We further match our survey data with geographical data on thebranches of a large retail bank in each country. In each country, we choose the largest,2 In the 2010 survey wave, 1,500 households were interviewed in Serbia.12