MICROFINANCE IMPACT EVALUATION: THEORY VERSUS PRAXIS
Abstract: By conducting a comparative analysis of microfinance impact evaluation (IE) from the researchers and practitioners perspective, the paper aims to uncover the existing gap between theory and reality. To that purpose an academic literature review on IE, based on Randomized Controlled Trials (RCTs), is contrasted with the practitioners’ social performance management approach (SPM). The two approaches differ not only in the results, but also methodologically, thus confirming the existence of such a gap. In particular the SPM framework appears to be more flexible, pragmatic and epistemologically grounded, while RCTs seem based on a more rigorous and statistical analysis, but both emerge as replicable and falsifiable. Besides the cooperation between the two environments is likely to bridge, or at least reduce, the gap because their advantages and disadvantages are more complementary than initially expected. On one hand practitioners can add rigorousness and quantitative analysis to the SPM approach and on the other hand academia can benefit from a higher degree of realism, pragmatism and philosophical solidity. Finally their merger, however with SPM as a guiding frame, appears also capable of strengthening both the scientific and pragmatic validity of microfinance IEs.
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