NO : WP-2025-022
AUTHOR : Varsha Vaishnav and Srijit Mishra
TITLE : Women’s Access to a Bank Account and Household Multidimensional Poverty in Rural India
ABSTRACT :
Women’s access to financial resources is not only intrinsically important but also has instrumental relevance for household well-being. To shed light on this issue, this study examines the relationship between women’s access to a bank account and household multidimensional poverty, using nationally representative data on rural households from the 5th round of the National Family Health Survey (NFHS). To address potential endogeneity of women’s bank account ownership, we employ a recur¬sive bivariate probit model with an exclusion restriction. The results indicate a significant nega¬tive relationship between women’s bank account ownership and household multidimensional poverty. This result is robust across alternative estimation methods, censored and uncensored measures of multidimensional poverty, and a sample restriction. Moreover, the effect is stronger in states and union territories (UTs) with lower levels of patriarchy. An improvement in women’s status, facil¬itated by access to a bank account, is offered as a plausible explanation for the main finding. We make two key contributions relative to existing Indian studies. First, we assess the instrumental relevance of women’s access to a financial resource for household multidimensional poverty, rather than focusing on household-level access. Second, we adopt a more comprehensive measure of mul-tidimensional poverty by drawing on the global MPI and enhancing it through a modification of the education dimension.
Keywords: Bank Account, Women’s Status, Patriarchy, Multidimensional Poverty, India, Probit Model
JEL Code: D14, I32, C25
Weblink: http://www.igidr.ac.in/pdf/publication/WP-2025-022.pdf
