Assessing Microcredit in Bangladesh: A Critique of the Concept of Empowerment

Assessing Microcredit in Bangladesh:A Critique of the Concept ofEmpowerment

NAHID ASLANBEIGUI, GUY OAKES & NANCY UDDINMonmouth University, West Long Branch, NJ, USA

ABSTRACT Assessing microcredit programs by testing their contribution to theempowerment of borrowers has been widely advocated and explored in the literatureon women and development. There is considerable debate on whether microcreditempowers or disempowers women, and there are attempts to reconcile conflictingconclusions based on heterogeneous samples or data sets and grounded in a variety ofmethodologies. Although there is little agreement on the relation between microcreditand empowerment and no consensus on the meaning of the idea of empowerment itself,students of gender and development seem to be at one in regarding empowerment as alogically unproblematic concept. We argue that the idea of empowerment employed inthis literature is vulnerable to a number of logical criticisms and cannot serve as asound basis for determining the value of microcredit to borrowers. Our researchsuggests that in assessing the impact of microcredit, it is essential to considergenerational and inter-generational differences it makes in the lives of borrowers andtheir families. Results of ethnographic work conducted in January 2008 on long-termborrowers of the Grameen Bank inform the exposition of the arguments.

1. Introduction

Assessing microcredit programs by testing their contribution to the empowermentof borrowers has been widely advocated and explored in the literature on genderand development.1 There is considerable debate on whether microcredit empowersor disempowers women,2 and there are attempts to reconcile conflicting

Review of Political Economy,Volume 22, Number 2, 181–204, April 2010

Correspondence Address: Nahid Aslanbeigui, Monmouth University, West Long Branch, NJ 07764,USA. Email: [email protected] microcredit programs have developed into microfinance institutions, providingother financial services to the poor such as deposit collection, pension plans, and life,health, and rainfall insurance. For differences between microcredit and microfinance,see Armendariz & Morduch (2005), and Qudrat-I Elahi & Rahman (2006). On Grameen’smicroleasing experience see Dowla (2004).2See, for example, Bernasek (2003); Corsi et al. (2006); Edward & Olsen (2006); Holvoet(2005); Hunt & Kasynathan (2001); Isserles (2003); Izugbara (2004); Kabeer (1999,

ISSN 0953-8259 print/ISSN 1465-3982 online/10/020181–24 # 2010 Taylor & Francis

DOI: 10.1080/09538251003665446

conclusions based on heterogeneous samples or data sets and grounded in a varietyof methodologies (see Kabeer, 1998, 2001). Although there is little agreement onthe relation between microcredit and empowerment, and no consensus on themeaning of the idea of empowerment itself, students of gender and developmentseem to be at one in regarding empowerment as an unproblematic concept. Theensuing discussion takes a less sanguine view. We argue that the idea of empower-ment employed in this literature is vulnerable to a number of logical criticisms andcannot serve as a sound basis for determining the value of microcredit to borrowers.

Even a cursory survey of the literature on empowerment, gender, and devel-opment is out of the question in an article of reasonable length. For this reason, webase our critique on an analysis of the work of three widely cited sets of authorswho have made substantial contributions to research in this area (Goetz & SenGupta, 1996; Hashemi et al., 1996; Kabeer, 1998, 2001, 2005a). Our strategy isto focus on some of the best and most influential studies of the relationshipbetween microcredit and empowerment in Bangladesh. This work makes a power-ful case for assessing microcredit by considering its consequences for empower-ment. We suggest an alternative mode of assessment that does not share theweaknesses of empowerment and is promising in other respects: evaluatingmicrocredit by examining its effects on the life histories of borrowers and theirfamilies. Our proposal calls for an analysis of long-term trends in life historiesand intergenerational effects of microcredit that is missing in the literature.

This paper employs results of ethnographic work conducted in January 2008on long-term borrowers of the Grameen Bank in Bangladesh.3 We interviewed tenvillage women in three districts located in the vicinity of the capital city: Manik-gonj, Dhaka and Gazipur. Each interview lasted approximately two hours. Tomaintain uniformity across subjects, we used a questionnaire that included a stan-dard set of 57 questions (see Table 1 for a summary of demographic information).Subjects compared their lives before receiving their first loans from the GrameenBank with their lives in 2008. Many questions were open-ended, and subjects wereencouraged to respond with as much detail as they felt comfortable.

After we arrived in Bangladesh, Grameen Bank representatives identifiedinterviewees on the basis of our two criteria. Because of time constraints, subjectswould be located within commutable distance from Dhaka, where we were based.Since we were investigating long-term impacts of microcredit, subjects wouldhave an extensive microcredit history.

Subjects were chosen on interview days depending on the availability ofGrameen’s branch officers and the interviewees themselves. Although one authoris bilingual in Bengali and English, we retained the services of an interpreterfluent in several Bengali dialects. Interviews were conducted in the homes of thesubjects. Periodically, family members, Bank officers, or neighbors dropped in

2005b); Mayoux (1999, 2001); Murthy et al. (2008); Rahman (1999); Rahman Khan(1999); Rowlands (1997); Schuler et al. (1996); and Todd (1996).3Before arriving in Bangladesh, we also contacted BRAC (Bangladesh Rural Advance-ment Committee) in order to interview some of its long-term borrowers. Our numerousemails received no response.

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on the conversations but did not stay for the entire duration of the interviews. Theobserved composure of subjects did not vary with the number, status, or gender ofobservants. Our sample is obviously small and not random. Because we do notperform statistical analysis on the data, these considerations are immaterial toour conclusions. We designed our ethnographic study to inform the exposition ofour arguments, the logic and validity of which are independent of field work.

2. Assessing Microcredit

Fatima is between 55 and 60, an unschooled Bangladeshi woman who has beenborrowing from the Grameen Bank for 20 years. Before joining the Bank, shemarried an unschooled man and had six children, three boys and three girls.They lived in extreme poverty. The husband pulled a rickshaw van to transportgoods, and she made puffed rice for wealthy landlords, receiving as wages ahandful of rice and a bit of cash. Family income was only enough to feed thecouple and their children twice a day and not sufficient to cover medical treatmentof the husband and the oldest son, both of whom suffered from an undiagnosedabdominal disease. Because of the leaky thatched roof of their house, they sleptunder umbrellas during the rainy season. The husband, who earned most oftheir cash income, made all the family decisions. Fatima was unhappy with herlow status in the extended family that resulted from this arrangement. Membersof her community would not lend her money, even the smallest sums, becausethey were convinced she could not repay them. There was never enough food,and family members were perpetually quarreling. Life was miserable and filledwith uncertainty.

In 1988, Fatima was introduced to the Grameen microcredit initiative by otherborrowers. Beginning with small sums to establish a traditional female business,making puffed rice in her bari, her loans became progressively larger. Fatima’shusband abandoned the rickshaw van and devoted himself to her business, which

Table 1. Demographic characteristics of ten Grameen long-term borrowers, January2008

Subject’spseudonym

No. of yearsas borrower

Age at timeof interview

Highest levelof education

Currentmaritalstatus

No. ofsurvivingchildren

Rashida 18 50 9th grade Married 2Mandira 23 60 none Widow 6Mahmuda 23 40–45 none Married 4Usha 18 40–45 5th grade Married 3Fatima 20 55–60 none Widow 5Minothi 17 36 8th grade Married 2Sadeka 18 40 none Divorced 2Selina 17 34 6th grade Married 2Khadija 16 39 7th grade Married 3Rahima 19 60 none Divorced 3

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became a family enterprise—the husband performing all tasks outside the house-hold, from purchasing unhusked rice to transporting the finished product andselling it. He continued to make most of the family and business decisions until dis-aster struck some five years after her first loan: both he and the oldest son succumbedto the undiagnosed illness. After their deaths, she assumed management of thebusiness and operated it for two more years, following which she bought 60 deci-mals of land in order to plant rice.4 Additional loans for a new house and a tubewellfollowed. She continued to manage her loans and make independent businessdecisions for another five years. In 1998, she relinquished control of her loans toher sons, who were old enough to assume responsibility.

How should the effectiveness of Fatima’s loans be determined? The chiefproblem that bedevils any evaluation of microcredit based on its contribution tothe empowerment of women is the concept of empowerment itself. In assessingmicrocredit by reference to empowerment, it is necessary to arrive at a standardof empowerment that programs of microcredit approximate in some degree, aset of conditions for empowerment that microcredit initiatives satisfy or fail tosatisfy. Consider the events that ensued when Fatima granted control of herloans to her sons. One son started a garment business, for which she took twolarge loans. The other son established a jute business supported by a third substan-tial loan that she assumed. Fatima continues to borrow large sums, which she sur-renders to her sons. They pay the installments, manage the income, and consult herin making business decisions. The only direct income she seems to control is themonthly rent from a house she built with a Grameen loan. Today, she lives insemi-retirement with her two sons, daughters-in-law, and grandchildren in a spa-cious house built with profits made from investing her loans. The extended familyhas a comfortable income. They are well-fed and clothed and own a television anddining room set as well as abundant furniture that fills the sons’ bedrooms. Fatimafeels she enjoys a status equal to that of the other adults in her household, a cir-cumstance she attributes to her microcredit history. She has also become arespected member of her community. One of her sons is regularly asked toresolve conflicts in the village. The villagers know his mother and respect herbecause of her son’s judgment. She is no longer ashamed to appear in publicand is quite comfortable moving outside her bari. And why not? She owns twohouses, and a piece of land she bought with a Grameen loan following thedeath of her husband has increased a stunning one thousand fold in value. Hersons are erecting a five-story building on land registered in her name. Fatimadeclares that she and her children are happy (shukhi). Which, if any, of theseeffects of her loans qualify as empowerment?

A general standard of empowerment presupposes a conceptual consensus onthe substance of the idea: its force or meaning as well as its reference and scope. Inthe present state of the literature, a consensus is not on the horizon. There is noagreement on the conditions that, if satisfied, would entail that women are empow-ered. Nor is there even agreement on precisely what the empowerment of womensignifies. The import and implications of the concept shift from author to author

4A decimal is 1/100 of one acre.

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and study to study, a state of confusion that explains why some publications usethe term liberally but place it in single quotation marks—‘empowerment’—marking its problematic status (Mayoux, 2001, p. 430).5

2.1. Problems of Definition

In their essay on managing loan use in rural Bangladeshi microcredit programs,Goetz & Sen Gupta note that although the concept of empowerment is a basictheoretical premise of research on gender and development, it is rarely specifiedwith any precision. Does empowerment entail a capacity to invest loans profit-ably? Or does it identify changes in gender relations such as an increase inwomen’s control over household decisions, physical security, and reproduction?Or are these two sets of variables interdependent—profitable investment ofloans presupposes improvements in gender relations, which also depend on suc-cessful investment (Goetz & Sen Gupta, 1996, p. 47)? Although the authors donot respond to these questions directly, they address them by introducingseveral distinctions. Empowerment differs from both access to credit andchanges in gender relations. It also differs from ‘strategic gains’ in intra-householddecision making and resource allocation. Finally, effects of changes in incomeshould not be conflated with effects of empowerment. Goetz & Sen Guptaanalyze women’s managerial control of loan use in production as one aspect ofempowerment. They do not suppose that their analysis provides an exhaustiveaccount of the concept. As they note, there are ‘many other aspects of women’sempowerment which might have been explored’ (Goetz & Sen Gupta, 1996,p. 48). However, they do not offer a rationale for treating control of loan use asan element of empowerment. Is there a rationale? Is there, for example, goodreason to suppose that the empowerment of women depends upon their controlof productive assets acquired by means of loans?

Our interviews document considerable diversity in degrees and varieties ofcontrol of loan use both from woman to woman and within the microcredithistory of a given woman. Consider, for example, Usha, who operated a puffed-rice business in the first decade of her 18-year membership in the GrameenBank. Although she applied for the loans and provided the labor, her husband pur-chased the inputs and sold the product. With profits from the puffed-rice business,Usha started a poultry business that she has managed exclusively for the past 12years, from buying chicks to selling eggs and disposing over the income. Thus, inher borrowing career, Usha has moved from shared to complete control of herloans. The 18-year loan history of Sadeka reverses the course taken by Usha.She began borrowing after she and her two children left her husband, who hadtaken another wife. She operated her first business, puffed rice, for ten years, pro-curing inputs, supplying labor, and controlling income. Like many Bangladeshiwomen, she relied on a male member of her family, her younger brother, to sell

5Since the word ‘empowerment’ appears frequently in this paper, rendering it in singlequotation marks would be tedious and distracting. Thus, we have not employed thisconvention, in spite of the problems posed by the concept.

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the product in the market. For the past eight years, she has owned a poultrybusiness in which she has taken a much less active role. Her Grameen loanshave enabled her to purchase 1,000 hens, which lay some 600 eggs daily. Herson manages the operations and controls the income. Selina and her husband,on the other hand, can be considered as operating joint ventures. A Grameenmember for 17 years, she has invested in several businesses, including raisingpoultry and fish, selling saris and Indonesian glass, and running a shop that mer-chandises mobile phones and cosmetics. Her investment decisions have beenmade jointly, and she manages all her businesses with the assistance of malemembers of her household. In purchasing supplies, she travels to markets withher husband or brother-in-law. Her son operates the shop, but she helps inperiods of high demand. Although she controls the income from these businesses,day-to-day operations are handled by male members of the family. Among oursubjects, Rahima seems to represent an extreme case of managerial independence.She began borrowing in 1989, after she and her children left her husband, who wasphysically abusive and had taken a second wife. For the past 19 years, her mainbusiness has been purchasing and renting rickshaws. Rahima has completecontrol of her microenterprise, making her own investment decisions, managingrentals, and controlling business income.

The extent of control over loans varies across interviewees and over time.In spite of this variation, the effects of microcredit on borrowers’ lives seemremarkably similar. Borrowers and their families achieve higher levels ofeconomic security, with advances in income, expenditure, assets, and savings.As borrowers gain economic security, they invest more in the schooling of theirchildren, female as well as male. Borrowers and their families enjoy enhancedemotional well being. High incomes and more assets improve their ability tosustain themselves through economic and health crises as well as natural disas-ters.6 They also reduce conflict among family members and diminish uncertaintyand anxiety about the future. The communities in which borrowers reside and dobusiness benefit from spillovers—volunteer labor, charitable contributions in cashand kind, improved employment opportunities, and a broader range of goods andservices.7

Differences in loan control are often a result of voluntary negotiationsbetween female borrowers and their male relatives. Consider again Usha, who

6In a cross-section study of the effects of microcredit on the emotional well-being ofBRAC members, Ahmed et al. (2001, pp. 1963–1964) conclude that ‘women’s micro-credit does little to influence favorably the emotional well-being of its recipients’ andcan actually damage it. The average length of membership in their study, however, isless than two years. Many of our subjects reported heightened anxiety in the earlystages of their microcredit history, which disappeared as they gained experience, econ-omic security, and assets.7On the effects of microfinance on household poverty, consumption expenditure, and non-land asset holdings in Bangladesh, see Pitt & Khandker (1998) and Khandker (2003). Onvillage-level effects of microcredit programs in Bangladesh, see Khandker et al. (1998)and Khandker (2003).

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was able to gain more control over her businesses by proving to her husband thather productive activities did not violate traditional norms of honor (shomman) orpropriety (achoron). ‘I don’t do anything that harms him or makes him look bad.I always consult him before making a decision.’ Khadija, who exercises substantialcontrol over her garment business but makes investment decisions jointly with herhusband, explains that her success in controlling business operations is due to herrecord in advancing family wellbeing. ‘My husband thinks that he agrees withwhatever I say. He understands that whatever I do is good for the family.’ BothFatima and Sadeka have divested themselves of control, passing on their loansto be invested by their sons. They regard themselves as semi-retired, an arrange-ment that seems to satisfy all parties. The sons repay the loans, contribute totheir mothers’ savings and pension funds, and give them periodic cash allowances.Sadeka proudly declares that her son thinks she has worked too hard for too manyyears: ‘My son does not let me work.’ Goetz & Sen Gupta consider othercircumstances under which a woman’s loss of control over her loan does notsignify a loss of power. A woman gives up control in order to acquire a morestable marriage or an improvement in health care for herself or her children.Relinquishing control may constitute a ‘viable economic and social survivalstrategy’ in which a woman gives her loan to male relatives and gains a guaranteedfood supply or other improvements in economic security (Goetz & Sen Gupta,1996, p. 50).

Goetz & Sen Gupta’s analysis of the rural Bangladeshi household suggeststhat, unless its structure changes substantially, women can never fully controltheir loans and thus can never become empowered. They represent household pro-duction decisions as joint ventures in which male relatives—husbands, brothers,and sons—participate. Cash, especially in large amounts, is a traditional maleeconomic resource, and its exchange in the public sphere of markets is a privilegedmale domain. Therefore, even if women secure loans and control productiveassets, the payoffs for empowerment are modest (Goetz & Sen Gupta, 1996,p. 53). Two troubling consequences follow from the authors’ analysis of controlof loan use as an element of empowerment. As they acknowledge, borrowers donot treat control of loan use as an essential condition of empowerment sincethey readily exchange it for social arrangements on which they place a higherpremium. And even if it were an essential condition, it could not be satisfiedbecause of the dominance of men in the monetary and public market sphere ofthe economy.8

8A final anomaly in Goetz & Sen Gupta’s analysis of empowerment should be noted. Intheir account of the relationship between loan size and control of loan use, they considerthe finding that control is generally inversely related to loan size. In the main, loss ofcontrol is correlated with increases in loan amounts (Goetz & Sen Gupta, 1996, p. 51).The more restrictive the potential for empowerment—the smaller the size of the loan—the more empowered women become. This conclusion seems paradoxical. A womanwho has 100% control over a loan of 1,000 taka is more empowered than a womanwho has 50% control over a loan of 10,000 taka. The more economic power in theform of cash that the woman acquires, the less empowered she becomes.

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2.2. The Dilemma of Criteria and Predictors

Goetz & Sen Gupta define empowerment of women as a process that depends ontheir success in gaining control of productive enterprises. Hashemi, Schuler, andRiley, on the other hand, are reluctant to venture a definition. However, they offera general analysis of empowerment that is more comprehensive than the accountof Goetz & Sen Gupta. In their view, empowerment is not a process but a state oroutcome, a set of conditions that women achieve as a result of their entrepreneurialefforts. They identify empowerment by reference to several variables, each ofwhich is verifiable: mobility, economic security, ability to make major andminor purchases, participation in major household decisions, relative freedomfrom family domination, political and legal awareness, and political activity.Hashemi et al. designate these variables as ‘indicators’ but also as ‘dimensions’or ‘aspects’ of empowerment (Hashemi et al., 1996, pp. 635–638). This is anunfortunate conflation. If the variables are indicators, they give evidence ofempowerment. If the variables are aspects or dimensions of empowerment, theyconstitute empowerment: each variable is a necessary condition for empower-ment, and taken together they define what it means to be empowered. The differ-ence between indicators and aspects or dimensions, which Hashemi et al. erase, iscritical. If x is an indicator of y, then y must be identifiable independent of x. Inorder to qualify as an indicator or predictor of y, x cannot be a property of y. Other-wise the claim that x is evidence of y would collapse into a tautology. Raindropsare not predictors of rain. They are rain. Dark clouds and thunder and lightningqualify as predictors of rain only because they do not constitute rain. Economicsecurity can be an indicator of empowerment only if it is not a constituent ofempowerment.

The conflation of indicators and aspects raises a further problem for theanalysis of empowerment. Hashemi et al. do not attempt to develop a set of criteriafor empowerment, a task they find too ambitious in view of the problematic char-acter of the concept. Their objective is to specify a set of behaviors, measures ofwhich provide a ‘composite empowerment indicator’ that exhibits the extent towhich women are empowered (Hashemi et al., 1996, p. 639).9 But in theabsence of criteria for empowerment, how do Hashemi et al. know what their indi-cators show? X can serve as evidence of y only given criteria that identify y. Other-wise it is impossible to determine what x is evidence of. The variables of Hashemiet al. can be understood as evidence of empowerment only on the basis of a set ofcriteria for empowerment. The upshot is a dilemma. Either the variables arecriteria for empowerment; in that case, they are not, as Hashemi et al. claim,indicators. Or they are indicators of empowerment; in that case, the absence ofcriteria for empowerment means that it is impossible to determine what they areindicators of. In either case, the result is unsatisfactory.10

9Swain & Wallentin (2007, p. 6) argue that composite indicators are vulnerable to criti-cism, because they assign arbitrary weights to each component.10This dilemma reappears in Corsi et al. (2006). Following the course taken by Hashemiet al., they introduce seven variables of women’s empowerment, which intersect with the

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2.3. The Kabeer Fallacy

Naila Kabeer has made some of the most valuable contributions to the literature ondevelopment, microcredit, and gender. In her essay on the Millennium Develop-ment Goal of gender equality and women’s empowerment (Kabeer, 2005a), sheprovides an analysis of empowerment that includes several essential premises.(1) Empowerment presupposes disempowerment. Actors who have been restrictedin their choices become empowered when their range of choices—their ‘ability tohave chosen differently’—expands. (2) Disempowered actors must have genuinealternatives; and since repressive power is exercised most effectively when itsoperation is invisible, actors can become empowered only if they see what theiralternatives are. (3) The decisions that empower are ‘strategic life choices’—exis-tential decisions on which all other choices depend, such as where to live, whetherand whom to marry, and whether to have children. (4) Strategic life choicesempower only if the exercise of one actor’s strategic life choices does not restrictthe strategic life choices of other actors. (5) Finally, the strategic life choices thatempower are ‘transformative’: they ‘transform power relations’ by changing theinstitutional conditions under which a woman acts, with the effect that thesocial space within which she makes her choices is reconfigured to her advantage(Kabeer, 2005a, pp. 14–15). More formally, suppose that P designates a person, Ca set of choices, and T time. P is empowered if and only if:

(1) At T1, P exercises choices C but is denied choices C’, where C’ is greater thanand includes C. At some later time T2, P exercises choices C’.

(2) At T2, P sees that she has options C’.(3) C’ constitutes a range of ‘strategic life choices.’(4) P’s empowerment—her exercise of C’ at T2—does not disempower any other

person P’. That is, the increase in P’s strategic life choices does not diminishthe strategic life choices of P’.

(5) P’s exercise of C’ is ‘transformative.’

Independent of the question of how a borrower’s choices can be identifiedand enumerated so that differences in their number and range at two differenttimes can be established and compared, Kabeer’s premises (4) and (5) pose prob-lems that cannot be resolved within the limits of her analysis.

Consider Khadija in 1992, shortly before she received her first Grameen loan.Her husband earned 500–600 taka per week as a tailor and supported a householdof eight members. They lived in a small house with bamboo walls and a sheetmetal roof on land that the husband had inherited from his father. The husbandmade all family and investment decisions and exercised complete control overhis income. Khadija was a housewife with no assets or income: ‘I had no

indices of Hashemi et al. but are not identical to them. What is the status of the seven vari-ables? Corsi et al. (2006, pp. 70–73) identify them as ‘indicators’ of empowerment andalso as ‘dimensions’ and ‘aspects’ of empowerment. This conflation reproduces the prob-lems identified in the above analysis of Hashemi et al.

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money, didn’t earn any, so I had no voice.’ In 1992, the power resources of thehousehold included the husband’s income, the bari, and the authority to makeintra-familial decisions. Khadija’s access to these resources was minimal.Today the family has four members and is significantly better off financially.After 16 years of taking progressively larger loans, Khadija’s garment businessmakes a weekly profit of more than 7,500 taka. She owns a shop, a personalsavings account, three pension funds, a piece of land with a new house, andfive sewing machines. Her husband, who is employed in his wife’s shop, ownsthe original home, now renovated, and a mobile phone. The family has an arrayof household goods, including a ceiling fan and a television set. Althoughfamily and investment decisions are made jointly, Khadija controls all theincome. It is clear that the power resources of the household have increased sub-stantially since 1992. It is also clear that in absolute terms, both Khadija andher husband have benefited from this development. Relatively, however, thehusband’s power resources have diminished. In the language of Kabeer’s analysis,Khadija’s status in the family has been transformed as a result of her microcredithistory, but at the expense of her husband, who has been disempowered.

Because microcredit changes relative access to power resources, once itenters a social system, Kabeer’s condition (4) will not be met. The source ofthis problem is the assumption of condition (4) that empowerment is never azero-sum process. Although this assumption is logically possible, it holds truein a regime of microcredit only on a utopian premise: no loan alters the relativestrategic life choices of actors in the social system, in consequence of whichmicrocredit has no effect on the distribution of resources for the exercise ofpower. This premise is also inconsistent with Kabeer’s condition (5), whichrequires that empowering choices alter the circumstances under which powerresources are distributed. Thus, Kabeer’s analysis of empowerment is deficienton two grounds: condition (4) can be satisfied only on an Edenic premise; andgiven this premise, condition (5) cannot be met.11

11In addition to the consideration that microcredit empowers one set of actors by disem-powering another, strategic life choices may be constrained so that a choice by a givenactor can restrict or rule out further choices on the part of the same actor. As Mayouxobserves, empowerment seems to be a contradictory process in which acts of empower-ment prove to be self-defeating. In the most obvious case, microcredit may increase therange of women’s choices by offering them loans but leave them worse off than theywere before because they are unable to meet repayment schedules. Failed microcreditentrepreneurs can lose not only assets but reputation, which compromises their abilityto acquire credit in any market (Mayoux, 1999, p. 968). Economic empowermentthrough microcredit may destroy dependency relations between women and landowners,traditionally the moneylenders of last resort, eliminating customary sources of criticalloans (Edward & Olsen, 2006, p. 43). Evidence from Africa and Latin America showsthat a woman who generates income through microcredit may lose the financial supportof her husband, who may divert his income from family expenditures to gambling,alcohol, prostitutes, or luxury consumption. Under some conditions, the husband mayeven abandon his wife or engage in polygamy (Mayoux, 1999, pp. 972, 974; Armendariz& Roome, 2008, p. 12). Evidence from Bangladesh shows that microcredit can increase

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2.4. The Paradox of Agency

In the literature on microcredit and gender, one of the chief objectives of empow-erment is to form, sustain, and strengthen agency. In the articles we examined,agency is understood as personal autonomy: the capacity to develop independentintentions, purposes, and decisions and the disposition to act on them. Women’sagency is critical to freeing them from the mutually reinforcing constraints of patri-archy, poverty, ignorance, and lack of mobility. As Kabeer observes, empower-ment often begins within, in a woman’s sense of herself as a person who makeschoices in ways that challenge and transform institutional limitations on herfreedom (Kabeer, 2005a, pp. 14–15). Mahmuda understood important changesin her life history from this perspective. Before she joined the Grameen Bank 23years ago, her family was completely dependent on the income of her husband, aday laborer. Because she made no contribution to family finances, she was shyand especially fearful over expenditures: ‘I thought I could not spend money.My husband would be angry.’ If guests arrived, she waited for her husband toreturn to the bari before deciding what to serve them. She did not leave the bariunescorted and regarded herself as an ‘appendage’ of someone else, lacking anidentity independent of her role as a wife or a daughter-in-law. Today, she feelsshe has earned the freedom to make choices, venture outside the bari withoutmale supervision, and spend money. When guests appear, she decides what topurchase and offer them. Although family and investment decisions are madejointly, she controls her income and her husband’s as well. Mahmuda characterizesthe fundamental difference between her pre- and post-Grameen identities in thefollowing terms: ‘Before [the loans] I was the wife. Now I am the boss.’

However, the literature we consider also suggests, paradoxically, that thissense of agency—the subjective dimension of empowerment—is an illusion. Itviews women in developing economies as dependent on the strategies of develop-ment theorists and planners. The empowered woman is conceived as a construct,an artifact of specialists in women and development—chiefly academics trained inwestern universities, NGO officials, and state policy makers on gender matters.Agency as realized in empowerment is a product of the microsocial structuresof order created by these specialists and the organizations they represent.Women may work to become empowered, but only in a social framework inwhich they are worked upon by experts who reform and engineer their identities.Empowerment, therefore, is mainly a consequence of what is done to women asopposed to what they do on their own behalf. Agency is determined principallyby organizational socialization processes in which development experts are themasters.

the incidence of domestic violence against women by male family members. A borrowermay be unable to cook her husband’s meals on time because a center meeting is delayed.She may refuse to transfer her loan to her husband or agree to the transfer but challenge herhusband’s use of the loan. Under these circumstances, tension within the household esca-lates, leading to verbal aggression or physical violence against women (Rahman, 1999,pp. 123–126). In all these instances, empowerment paradoxically disempowers.

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The institutional formation of women’s agency is especially clear in thepolicies and operations of microcredit institutions such as the Grameen Bank.Consider the distinctive village banking rituals that it imposes on borrowers:group meetings; collective recitation of the now famous ‘sixteen decisions’(Grameen Bank, 2008b), which have the objective of rationalizing the characterof borrowers in directions that conform to bank policies; the salute that marksthe identity of Grameen members; and weekly installment payments, deliveredin meetings attended by members of several groups. These routines define thesubjectivity of the Grameen borrower, whose agency is formed by the bank’s strat-egies of development. The main determinant of the character of the borrower is thebusiness model of the bank: progressively larger loans and investments to improvefamily income, consumption, health, and education; peer surveillance to maintaindiscipline; community involvement; and a commitment on the part of members toa life of hard work, frugality, cleanliness, personal responsibility, courage, andtrustworthiness—virtues that are held to liberate Bangladeshi women frompoverty and oppression (Grameen Bank, 2008b).

Hashemi et al. stress the regimented and ritualized features of Grameensocialization mechanisms. Not only do members salute at weekly meetings, butthey sit in rows on the dirt floor of the village bank center, chant slogans,perform physical exercises in concert, and address officials of the bank (typicallymen) as ‘Sir,’ ‘The Sirs,’ or ‘The Bank Sirs.’ These rituals ‘plainly cast them[the members] in a subservient role.’ Bank rituals form the agency of Grameenborrowers on the basis of disciplined obedience and deference to bank officialsand careful adherence to the Bank’s economic and human relations policies. Thewomen of Grameen are subordinated to male bank officials, methodically regulatedby the socialization processes of the bank, and incorporated into the public socio-economic hierarchy of Bangladeshi society at its bottom. And yet Hashemi et al.note that the intention of this mode of agency construction is a set of ‘styles of be-havior’ designed to empower rural women (Hashemi et al., 1996, p. 649).

Changes in the lives of the subjects of our interviews document the extent towhich their identities—not only the styles, but the basic premises of theirconduct—are anchored in the priorities of the Grameen Bank. Although weasked borrowers no questions about the 16 decisions, their responses to questionswe did pose reproduced the logic and rhetoric of Grameen discourse, at times evenrepeating the language of Bank policies.

Concerning progressive borrowing and investment, each borrower had atleast one loan for every year of membership, and the majority had progressedto larger numbers. (Mandira, a member of the Bank for 23 years, had taken 46loans.) All borrowers started with small loans of 1,000–3,000 taka—approxi-mately US$15–45 at the current exchange rate—for projects intended toachieve immediate cash flow: unhusked rice that could be processed to makepuffed rice, livestock that could produce milk, poultry that could lay eggs, andrickshaws that could be rented. In a few years, larger loans supported acquisitionsof increasingly valuable assets: mobile phones, sewing machines, householdappliances, land, and houses. The largest loan recorded by an interviewee was400,000 taka, but loans of 100,000 to 200,000 taka were common in laterstages of Bank membership. As regards housing, food, cleanliness, and health,

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all borrowers had built Grameen-style houses with sanitary latrines and tubewells.Some had brick houses under construction. Many grew their own rice and veg-etables, and those who did not were prosperous enough to buy their food on themarket. Although our research was carried out in the Bangladeshi dry season,when virtually everything was covered with a thick layer of dust, the living quar-ters of our interviewees were remarkably clean, as were the borrowers themselves,their children, and grandchildren. Perhaps these factors explain why only a fewborrowers or their family members had healthcare expenses. Those who neededmedical attention spent regularly on chronic problems such as high blood pressure,gastritis, arthritis, and kidney disease.12

Although it is not clear whether the Grameen succeeded in training our sub-jects in family planning, the majority practiced it after receiving their loans.13

Schooling of children was determined by the success of microcredit ventures.Prior to membership or in the early stages of borrowing, female childrenmarried young, and neither boys nor girls received much schooling. Whenfamilies no longer lived in poverty, children—both female and male—receivedmuch higher levels of schooling. Several children of borrowers, again bothfemale and male, had either received a baccalaureate degree or were workingtoward one at the university. Usha wants her daughters, who are studying at theuniversity, to become teachers or college professors. Minothi hopes that herson, who has an associate’s degree in textile engineering, will complete hisstudies in engineering at the university. Her daughter, who was in fifth grade,received government scholarships because she was first in her class, andMinothi hopes to see her become a physician. Rahima’s advice to her childrenis not to ‘lose the momentum’ she had achieved in upward economic mobility.

All interviewees exhibited the Grameen ethic of hard work, discipline, frugality,and courage—the readiness to assume risks in initiating business ventures thatpromise to transform their lives. Rahima refuses to buy more than two saris a year,the same number she had before joining the Bank. ‘I am not a big spender and amvery careful with money.’ Most subjects reported that they work extremely longhours. Usha works harder now than she did before becoming a Grameen memberand is not comfortable taking days off. Before her Gameen membership, she didnot have money to eat three meals a day. Today she is so busy that she skipsmeals. Rashida believes that Grameen gave her ‘courage’ to embark on new enter-prises: ‘This is why you [the interviewers] are here. I am talking to you.’ Beforeher first loan, Selina claimed, she was worried because she did not have ‘courage.’That worry has disappeared. Today, she has bank loans, a business, and ‘courage.’14

12See Todd (1996), whose study of two Grameen villages produces similar results for bor-rowers with a credit history of ten years. See also Kabeer (2001).13On the effects of microcredit programs on contraceptive use and fertility in Bangladesh,see Schuler & Hashemi (1994) and Amin et al. (1994).14The above account covers 10 of the 16 decisions. As we will see below, the results of ourinterviews on questions of dowry are mixed. Borrowers provided little information onother decisions: planting trees in the appropriate seasons, peer surveillance with a viewto imposing discipline and maintaining order and justice, and collective action.

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Goetz & Sen Gupta argue that the social identities of rural Bangladeshiwomen can be reconstituted to enable them to control loan use. This can beachieved only through initiatives in ‘social engineering’ that require ‘penetratingthe household to tackle gender power relations’ (Goetz & Sen Gupta, 1996, p. 56).In order to succeed, members of microcredit programs need training in ‘humanresource development which can enhance loan use as well as household well-being and structural change at the local level.’ Goetz & Sen Gupta also stressthe importance of ‘supplementary services to bolster leadership and social devel-opment’ and ‘awareness-raising and functional education’ in forming the skillsof women entrepreneurs (Goetz & Sen Gupta, 1996, p. 56). In their view, theexclusion of Bangladeshi women from public market places is perhaps the mostsignificant obstacle limiting their economic productivity. Without access to themarket, women cannot make accurate judgments of market demand or graspnew opportunities for investment.15 Gaining access to markets is a method ofcreating the autonomy on which women’s agency depends. However, anyattempt to open rural markets in Bangladesh to women is likely to spark resistancefrom men. As a result, ‘considerable investment in support systems,’ includingtransportation and ‘security measures to protect women from physical assault,’are necessary. Women can gain entry to rural markets, where they appear andwork independently of male relatives, only by breaking down the traditionalethical and ritual constraints of purdah. Thus, women’s independence dependson a reconceptualization of female agency, a redefinition of what it means to bea woman. As Goetz & Sen Gupta note, a change of this magnitude depends onenlightened policies of banks and NGOs and the coercive police powers of thestate. The same point—the dependence of women’s agency on state interven-tion—holds for Goetz & Sen Gupta’s discussion of an array of other conditionsfor the possibility of women’s agency, including ‘continuous investment in lit-eracy and numeracy training’ and investment to change the thinking of bothmen and women regarding women’s rights over their productive resources andlabor skills. The authors envision sweeping political reforms that would guaranteewomen’s rights of ownership and inheritance (Goetz & Sen Gupta, 1996, p. 59).

Goetz & Sen Gupta seem to perceive the paradox entailed by this position.On the one hand, agency is possible only on the grounds of choices that are

15Our research does not confirm the position of Goetz & Sen Gupta on the limitations thatwomen’s restricted participation in public markets place on their knowledge of businessopportunities. Rahima claimed that her businesses—buying livestock and renting her rick-shaws and house—were based on her own thinking. Selina developed her concept of anIndonesian glass business by observing another person engaged in the same trade. She con-ducted her own research on where to buy and sell. Several borrowers—Rashida, Usha,Fatima, Selina, and Rahima—learned about business opportunities in conversation withother members of the Bank or Bank officers. Some receive advice from male familymembers. While doing business in the market, Rashida’s husband is attentive to tipsabout pieces of land that may be for sale. He shares this information with his wife, whomakes the buying decisions. Khadija’s garment business had its origins in training pro-vided by her husband. Finally, Fatima keeps abreast of new possibilities for business ven-tures by talking with her sons.

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formed autonomously. On the other hand, the obstacles in the path of autonomyfor Bangladeshi women ‘require state-level responses.’ The result? ‘Policyefforts to enhance women’s loan control may run the risk of introducing adegree of organizational control and surveillance over women’s loan investmentdecisions which unacceptably undermine women’s autonomy in decisionmaking over loan use’ (Goetz & Sen Gupta, 1996, p. 59). Stated more generally,the institutional requirements of empowerment—intervention by academicexperts, NGOs, and agencies of the state—nullify autonomy, the fundamentalrequirement of agency on which empowerment is based. Subjectively, empower-ment is possible only on the basis of agency. Sociologically, empowerment ispossible only on the basis of institutional prerequisites that rule out agency.

2.5. Macrosocial Inertia or Institutional Flexibility?

In the literature on gender and development, empowerment depends on tectonicshifts in institutions that have proven to be impervious to programmatic interven-tions. Put another way, empowerment requires long-term macrosocial changesthat will transform traditions governing gender relations. Goetz (1992, p. 12)has observed that rural Bangladeshi women are enmeshed in social relations ofpatrimonial domination that are ‘among the least negotiable in the world.’Kabeer notes that the monetization of the Bangladeshi economy has not substan-tially altered an inequitable gendered division of economic labor that has persistedfor centuries and remains entrenched. Monetization has opened up new opportu-nities for men, whose ability to exploit them is limited mainly by their social statusand educational accomplishments. Not so for women, who remain ‘largely con-fined to the precincts of their homesteads, disadvantaged in access to educationand other market-related credentials and dependent on male members of theirfamily for provision and protection’ (Kabeer, 1998, p. 32). Following the linegenerally taken by students of gender and development in Bangladesh, Kabeerconsiders the historical inertia of two durable and relatively intractable institutionsthat determine socioeconomic life chances of women: patriarchy—the ensembleof power relations, norms, and rituals that undergird male domination ofwomen in all spheres of life; and purdah—the concealment and seclusion ofwomen and their exclusion from public activity.

In discussing the force of patriarchy and its resistance to modernization,Kabeer considers the sense in which land in Bangladesh remains a distinctivelymale asset. Although Islamic jurisprudence grants women one-half of the shareof land inherited by their brothers, Bangladeshi women typically do not exercisethis entitlement. Because the collapse of a marriage can impoverish a woman, shecustomarily waives her right to inherited land in favor of her brothers in order togain their protection in the event of her divorce (Kabeer, 1998, pp. 55–56). Thelegal registration of a valuable asset such as land is conventionally made in thename of the principal male member of a household even if it was acquired by afemale member through a loan. This practice conforms to Bangladeshi traditionsregulating distribution of power in the household, reproducing ‘gender asymme-tries in opportunities and constraints.’ Exceptions to customary male registrationof assets acquired by women also follow tradition. Poultry and small livestock

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such as goats are conceived as women’s property. Because petty assets areregarded as the province of women, their acquisition under a woman’s name isnot perceived as a violation of the standards of patriarchy (Kabeer, 1998,pp. 58–60).

In stressing the durability of centuries of purdah restrictions in Bangladesh,Kabeer comments on how purdah norms may necessitate a choice between auton-omy and propriety. Mobility as expressed by buying and selling goods in thebazaar is proof of independence but also a mark of status dishonor (oshommon)and shame (lojja). In consequence, women of higher rank demonstrate theirrespectability by adhering to rules of exclusion, at the same time differentiatingthemselves from poorer women who are deprived of the choice betweenfreedom in the market place and seclusion in the homestead.16 The only optionfor lower class women may be the brutal economic choice between starving inseclusion and trading in the bazaar (Kabeer, 1998, pp. 64–70). As Kabeer sum-marizes the strength of purdah traditions, Bangladeshi women follow rules ofpurdah when they have the resources to do so, ‘both to signal their enhancedsocial standing within their community and to differentiate themselves fromlower-status women who do not have this choice’ (Kabeer, 1998, p. 70, emphasisin original; see also p. 82).17

Thus empowerment presupposes fundamental changes in legal, political,economic, and religious structures that have been in place for centuries.Changes of this magnitude cannot be expected over a short period. It followsthat empirical work on the effects of microcredit on the empowerment ofwomen should cover a long term. Surprisingly, the studies examined in thisessay consider only a few years of data. This research strategy ignores macrosocialinertia and assumes maximum institutional flexibility: large-scale social changescan be plausibly understood as short-term phenomena. What is the duration ofmicrocredit membership in the papers that we consider?18

Goetz & Sen Gupta (1996, pp. 47, 62) base their conclusions on fieldworkconducted in Bangladesh between February and October 1993. They target micro-credit participants in four programs—BRAC, Grameen, RD-12, and TMSS—andcollect 275 loan histories, recording information on who invested the loans, pro-cured inputs, and priced and marketed outputs (Goetz & Sen Gupta, 1996, p. 480).

16Although the institution of purdah restricts the mobility of women, it is ‘less a rigid set ofrules than a mindset open to interpretation’ (Todd, 1996, p. 5; also see Bornstein, 1996,p. 143 and Kabeer, 2001, p. 69). Our interviewees seemed at ease with the malemembers of our team, including Grameen officers from headquarter and branch offices,the bank officer who collected their weekly installments, and our interpreter. They alsoreported that they were quite comfortable moving outside their baris. As noted above,Selina helps her son sell cosmetics and mobile phones at their shop in periods of highdemand. She justifies the apparent violation of the purdah norm by insisting that sheworks for herself in her own socioeconomic space: ‘It is my own shop.’17On the assumption that empowerment requires fundamental shifts in basic institutionsthat resist change, see also Kabeer (2001, p. 83; 2005a, p. 23); Mayoux (1999, p. 978);and Goetz & Sen Gupta (1996, p. 59).18On the importance of duration of membership, see Chowdhury et al. (2005).

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At the time of their study, BRAC existed for seven years, RD-12 for five, Grameenfor ten, and the majority of TMSS microcredit activity for two years. This meansthat the oldest borrower could not have been a member for more than ten years.Membership duration for a significant majority of borrowers—76.2%—rangedbetween less than one year to five years.19

Hashemi et al. combined quantitative and qualitative methods of data collec-tion. In their quantitative work, they surveyed 1,300 Bangladeshi microcredit bor-rowers and non-borrowers who were below the age of 50 in 1992. The averageduration of membership was 3.9 years for Grameen members and 3.7 years forBRAC members, with standard deviations of 2.4 and 1.7 respectively (Hashemiet al., 1996, p. 640). In their ethnographic work, they made monthly observationsof 60 borrowers over a period of one year. The longest membership durationamong those observed was eight years (Hashemi et al., 1996, p. 647).

Kabeer’s (2005a) analysis is based on fieldwork performed in Bangladesh inearly 1997. In the first phase of her study, she administered a short questionnaire toa cross-section of 696 borrowers participating in the Small Enterprise Develop-ment Project (SEDP), collecting information on demographics, loan use, andimpact of microcredit. The second phase included interviews with a subset of70 borrowers, who were asked to evaluate the effects of loans on their lives(Kabeer, 1998, pp. 19–20). Since the earliest component of SEDP was establishedin Bangladesh in 1990 and the interviews were conducted in early 1997, the mem-bership duration in Kabeer’s study cannot extend beyond seven years.

In the articles under examination, no borrower had a loan record thatextended beyond ten years, and many had been members of microcredit organiz-ations for no more than five years. Yet the authors assume that empowerment is along-term project. Microcredit programs confront formidable obstacles in thepower and legitimacy of institutional traditions such as patriarchy and purdah.Fundamental changes cannot be anticipated in a few years. It follows that themacrosociology and the historiography underpinning these studies of microcreditand empowerment are inconsistent with their short-term research strategies.

In general, evaluations of microcredit rely heavily on cross-section data. Thestudies of Goetz & Sen Gupta and Hashemi et al. are not exceptions. Based ondifferences in degrees of empowerment observed in a number of borrowers at aparticular point in time, they make inferences about empowerment gains of indi-vidual borrowers over their lifetimes. However, the life histories that emerge fromthese studies are statistical constructs that depend on the characteristics of bor-rowers who happen to be included in the sample. Not surprisingly, cross-sectioninvestigations of the same question often vary significantly in their conclusionsand sometimes arrive at mutually inconsistent results. They are also ahistorical.Statistical constructions of actors and their behavior produced by cross-sectionmethods are not narratives that identify the expressed intentions of real historical

19Information on BRAC and Grameen was obtained from their Websites. Information onTMSS (Thengamara Mohila Sabuj Sangha) was received in correspondence with theorganization on July 4, 2008. On Bangladesh Rural Development Board Rural Develop-ment RD-12, see Jackson & Brodhead (2004).

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actors and connect these intentions to their conduct, the consequences that followfrom the actions they perform, and the bearing of these consequences on their sub-sequent intentions.20 Although cross-section studies suggest a sense of change inthe life of an average borrower from earlier to later years of her membership in amicrocredit program, the absence of a narrative account of action makes it imposs-ible to grasp sequences of events and the irrevocability of historical changes.21

Focusing on the life histories of borrowers has three important methodologi-cal advantages. It considers credit histories over a long period, emphasizingchanges in the lives of borrowers in historical time. It ignores ephemeral andinconsequential changes in their lives, concentrating instead on generationaland inter-generational movements. The generational and inter-generational per-spective conforms to the views of borrowers, who consistently assess microcreditby reference to its impact on the family unit and not their individual welfare.Finally, it captures significant and irreversible changes in traditional genderrelations, a fundamental barrier to the success of poor women in Bangladesh.

Our subjects had borrowing histories from 16 to 23 years. Without exception,they saw their long-term economic success, which was achieved by cash incomebased on loans, as the factor that produced the most significant changes in theirlives. With the help of Grameen loans, all our interviewees had acquired ahouse, the land on which it was built (a requirement for Grameen house loans),businesses, livestock, and poultry. Over many years, they had accumulatedother sizable assets. Several borrowers had acquired additional pieces of land.Rashida owned one acre, a significant parcel in view of the small size and largepopulation of the country. Fatima owned land reported to be worth 10,000,000taka. Five borrowers owned an additional house, and Fatima and Minothi werein the course of erecting third structures, in both cases a brick building ofseveral stories.

20Because cross-section analyses cannot control for factors that can bias their results, theyare open to a number of other criticisms. For example, borrowers may belong to micro-credit programs that are not distributed randomly over various locations, or they mayhave joined through a self-selection process. In addition, factors such as innate abilityor entrepreneurial spirit may not be observable or quantifiable (see Armendariz &Morduch, 2005, pp. 199–224; Chowdhury et al., 2005, p. 308; McKernan, 2002; Pitt &Khandker, 1998; Sharma & Zeller, 1999). Although studies based on carefully collectedpanel data can remedy some of these biases (Armendariz & Morduch, 2005, pp. 210–222; Khandker, 2003, p. 7), they are expensive and rarely performed. To date, paneldata research on microcredit has been limited to short periods. See, for example, Cole-man’s (1999) quasi-experimental study, which is based on data from two microfinanceprograms in northeast Thailand; participants were interviewed four times in 1995–96.Khandker’s (2003) study of microfinance participants in Bangladesh is based on paneldata provided by the World Bank and the Bangladesh Institute for DevelopmentStudies, which were compiled in 1991–1992 and 1998–1999 and cover changes over aseven-year period; the study is silent on duration of borrower membership.21On the irrevocability of change in historical time see Setterfield (1995). There is anextensive literature on the epistemological and ontological dependence of history on nar-rative. Perhaps the most influential and useful source is Danto (2007).

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Cash income and wealth accumulated over decades of borrowing are tightlylinked to status in the household and community as well as mobility beyond thebari. Commenting on gender relations in her household before she began borrow-ing, Rashida maintains that, due to her poverty, her domestic standing did notmatch that of her husband. Because of her poverty, she was reluctant to leaveher bari. Today, she enjoys a social position higher than her husband’s. She attri-butes this to her control over money and the necessities of life and her consequentpower to manage the affairs of her household. As a result, she enjoys the respectof her fellow villagers, who take her views seriously. She no longer feelsuncomfortable moving about alone. Because of her elevated social status, shecan ask a woman from another bari to accompany her on local excursionswithout fearing that the woman’s family will refuse. Minothi explains herearlier insignificance in her household by reference to economic factors. Shehad no earning power, and her husband was responsible for all their cashincome. As a result, she had little autonomy and no respect in her community.Today, she believes she has achieved a social position higher than her husband’s,a change that is due to her Grameen loans. Her autonomy and reputation in thecommunity have improved as well. Minothi’s explanation: ‘Money bringsrespect.’ Selina interprets her former menial position along the same lines. Sheunderstood that in order to gain a ‘voice’ in the household and the village, sheneeded to acquire earning power. Shy, in want of many things, and reluctant toleave her bari, her earlier economic and social existence was dismal: ‘If youdon’t have money, there is no respect.’ Because she can take loans, earnmoney, and invest it, her social standing has advanced considerably. Nowpeople respect her and see her as a leader. As Selina puts it, if she tells tenpeople to do something, nine will follow her. Mobility outside the bari is nolonger a problem: ‘If other people can move, so can I. Because I am no longerpoor, I am not self-conscious. I can blend in.’ Before Sadeka began borrowingfrom Grameen, she was a divorced day laborer, digging soil and enmeshed inthe social and moral economy of poverty. Members of her community treatedher with indifference or contempt. No one spoke to her or cared for her needs.Her children were unacceptable as hired help. Not even her brothers attended toher most basic nutritional needs, and on one occasion she did not eat for threedays. Today, her miseries have ended, and she is a valued member of her commu-nity. Why? In Sadeka’s view, the answer lies in her wealth and possessions, whichinclude a house, a television, and several mobile phones. She is invited to socialfunctions because of her prestige in the village, which she certifies by liberaldonations of 10,000 to 15,000 taka to the mosque. Khadija also saw herunhappy pre-Grameen life as a consequence of her lack of earning power.Because of her poverty, she did not speak with her neighbors or visit theirhouses. Diffident and withdrawn because she could not afford socially acceptableclothing, she was largely confined to her bari. Today, members of her communityseek her companionship and influence: ‘I can lend them money.’ Now, when sheno longer needs them, she has offers of loans from her neighbors.

Have the generational effects of microcredit affected women’s views ongender equality and dowry? Our interviewees exhibit a shift of positions in thedirection of more egalitarian views on the relations between men and women.

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However, their commitment to dowry is more resistant to change—this in spite ofthe fact that refusal to give or receive dowry is one of the 16 Grameen decisionsand is frequently recited by borrowers. These findings seem paradoxical. If womenregard men as their equals, it seems that this position would encourage them torepudiate the practice of dowry. In the main, although not without exceptions,our interviews document the former position but not the latter.

Because of her many years of membership in the Grameen Bank, Rashidabelieves she has achieved financial independence. As she puts it, she does not‘have to depend on a man.’ Yet she is not against dowry. Although she did notpay dowry when her daughter married, her motives were instrumental, based onutilitarian calculations by the families on both sides of the marriage. Rashida’sdaughter had earned a baccalaureate degree. The family of the husband, whoheld a master’s degree, regarded her as an attractive investment. Rashida didnot pay dowry because the circumstances of her daughter’s marriage did notrequire it. Because of the human capital her daughter brought to the marriage,the son-in-law’s family paid Rashida 30,000 taka, a socially acceptable andexpected means of persuading her to grant her daughter permission to move toDhaka, about an hour from Rashida’s village. Patriarchal norms have prevailedboth in the marriage and in the relative values Rashida ascribed to the marriedcouple. The husband withdrew his wife from law school in order to avoid thepossibility of competition with his brother, who is a lawyer. Rashida’s daughteris now enrolled in a different master’s program, and Rashida raises their threeyear-old son, allowing her daughter to work for BRAC and finish her education.The couple sends her money for clothes and oil for her hair; Rashida praisesher son-in-law but not her daughter.

Mandira, who does not share Rashida’s professed views on the equality ofwomen, had both paid and received dowry. Her daughters had no formal schoolingand were married in their teens. The oldest daughter, who married at 13, brought apair of gold earrings and 1,500 taka as dowry. The middle daughter, who marriedat 14, had ten grams of gold and 8,000 taka. By the time her oldest daughtermarried at 15, Mandira was more prosperous and could pay 30 grams of goldand 15,000 taka. More recently, her son, a university student, married a youngwoman who had completed secondary school. Mandira received a dowry of100,000 taka as well as 50 grams of gold from the family.

Usha claims that prior to her experience in the Grameen Bank, she had neverconsidered gender issues. Because of her experience, she now sees girls and boysas equals. She also connects enlightened views on gender with business acumen.‘If I had this idea [of gender equality], I would have been able to own a big piece ofland, seventy to eighty decimals. Land is a very good investment. Eighteen yearsago, a twenty-decimal parcel of land cost 25 taka. Now it is 5,000,000 taka.’Despite these views, Usha paid dowry to her son-in-law’s family: 60,000 takain addition to furniture and a television that cost 50,000 taka. Sadeka notes thatshe has always considered men and women as equals: ‘If they can work, whyshouldn’t we?’ However, her views on dowry have changed, which she attributesto her Grameen membership. Her daughter did not marry with dowry, nor didSadeka take dowry from the family of her daughter-in-law, whose mother isalso a Grameen member. Selina maintains that before she took loans from the

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Grameen Bank, she gave no thought to questions of gender. That has changed, sheclaims, because Grameen women have ‘gained their status.’ Her son was expectedto marry some five months after our interviews, and she declared that she did notexpect dowry from the family of her future daughter-in-law. ‘Why would I takedowry? I don’t like to attend weddings where dowry is involved. I am small butintelligent. I got that from Dr. Yunus.’ Khadija had vague ideas about genderequality before receiving Grameen loans, but these ideas played no part in herlife. Now she enjoys a position equal to her husband’s: ‘What is wrong with equal-ity? I control everything now, but we are equal.’ When her daughter married acomputer engineer after finishing secondary school, she spent 150,000 taka onthe wedding but paid no dowry to the husband’s family.

Rahima provides the most interestingly complex set of observations concern-ing gender relations. Before her Grameen membership, she did not regard boysand girls as equals. Now she says that she does: ‘That [a commitment to genderequality] is why women are more powerful now.’ However, she also claims thatshe dislikes ‘this gender equality thing.’ Why is gender equality objectionable?‘I care about purdah. Girls should be friendly with everyone and respect elders.’Although adherence to the rituals of purdah is important to Rahima, she doesnot take the same view of dowry. The family of her daughter-in-law, who hadno schooling, did not pay her dowry. Nor did she pay dowry on behalf of herdaughter, who had seven years of schooling and married a man with a baccalaure-ate degree; but she did give her daughter 15 grams of gold on her marriage.Rahima believes in gender equality but does not approve of it because itencourages women to violate purdah—the Bangladeshi institution that embedsgender inequality most visibly and systematically. She neither took nor receiveddowry but endowed her daughter with gold on her marriage. Taken together, dothese positions make sense? They do to Rahima, and she betrays no lack of con-fidence in interviews.

In sum, the stories told by our subjects on issues of gender equality and dowryare decidedly mixed, suggesting that investigations are not likely to discover uni-formity and consistency in the fluid contemporary culture of Bangladeshi genderrelations. In consequence, the project of developing generalizations concerningthe character and pace of change in the institutions of patriarchy and purdah islikely to be perilous.

3. Conclusion

By way of conclusion, four points are pertinent. First, the problems generated bythe concept of empowerment suggest that it is not a viable candidate for assessingmicrocredit programs. Our critique indicates that in evaluating the benefits ofmicrocredit for women, researchers should look elsewhere.

Second, the ultimate goal of microcredit is to advance the process of devel-opment by ‘fighting poverty’ and changing ‘the quality of life of the poor people’(Grameen Bank, 2008a; BRAC, 2008). Since a disproportionate share of the pooris female, this goal cannot be achieved without changing ancient customs andinstitutions that govern gender relations, such as patriarchy and purdah.

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Third, in determining whether microcredit achieves the above goal, it is futileto target short-term changes in the lives of borrowers. Although evaluations ofmicrocredit based on empowerment acknowledge this point, they generallyexamine short-term results. Our research suggests that in assessing the impactof microcredit, it is essential to consider generational and inter-generational differ-ences in the lives of borrowers and their families.

Finally, if macrosocial change cannot be expected in the short term, what arethe consequences for the analysis of the effects of microcredit on institutions?Again, we suggest taking a longer perspective by examining the place of micro-credit in the life histories of borrowers and their families. Such an approachdemonstrates that institutional transformation is a much more complex matterthan the literature on microcredit and development generally supposes. A con-sideration of generational and intergenerational effects of microcredit opens upseveral possibilities. In some cases, initiatives taken by microcredit organizationsor by the borrowers themselves may substantially weaken institutions. There maybe little or no discernable change in institutional structures over five to ten years;in the long term, however, changes in women’s economic behavior alter insti-tutions at the margins or from within (see Todd, 1996, p. 181). These changescan produce additional differences in the way women conduct their lives andhow institutions function. In other cases, life histories may show that certain prop-erties of institutions remain relatively inflexible at the same time that others arerecast. There is no seismic shift or transformation but a contingent set of adjust-ments in beliefs and practices that do not follow a uniform or consistent pattern.

Acknowledgments

The authors thank Monmouth University for several sources of funding: a grant-in-aid-for creativity, the research budget of the Jack T. Kvernland Chair, and LeonHess Business School. The authors are grateful to Mrs Jannat E. Quanine and MrMosleh Uddin of the Grameen Bank for facilitating their research. GerhardWagner, Veronica Montecinos, and Michele Naples provided helpful commen-tary. For research assistance, the authors thank Andre Renaudo and Mary-AnnGuyler. An earlier version of this paper received the 2009 KPMG Best PaperAward of the Gender Issues/Work-life Balance Section of the American Account-ing Association.

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