Established in 2004 as a United States Government corporation, the Millennium Challenge Corporation’s (MCC) mission is to reduce poverty by supporting sustainable, transformative economic growth in developing countries that create and maintain sound policy environments. MCC is designed to support innovative strategies and to ensure accountability for measurable results.
The goals of MCC’s Compact with the Government of Benin include:
- Reduce rural poverty through better economic performance in the agricultural and rural sector through securitization of the land tenure system
- Increase rural households’ access to credit.
To achieve these goals, MCC programs in Benin aim to improve physical and institutional infrastructure in Benin through land tenure reform (Access to Land component) and to expand access to financial services for households and small and medium enterprises (Access to Credit component). Improvements in tenure security are expected to increase investment incentives, lower transaction costs, and improve occupants’ access to financial services. These programs are designed to accelerate economic growth and reduce poverty by removing constraints to investment.
NORC is designing, coordinating, and implementing rigorous impact evaluations of the Access to Land and Access to Credit components of MCC's programs in Benin. The impact evaluations will measure the contribution of these interventions to changing household income in the project intervention areas as well as examine the total value of additional investment on targeted rural land parcels.
For the Access to Land program, NORC developed a randomized design, beginning with random selection of program villages at the national level using publicly-sponsored lotteries. For the Access to Credit evaluation, NORC is using a matched-pairs quasi-experimental design to evaluate the effects of these programs on improving the efficiency of transactions and increases in the availability and accessibility of funds for borrowers through improvements in information technology. The evaluation examines changes in the volume of transactions; the number and profile of loans issued, and increased use of financial intermediation services by SMEs and small-scale agricultural producers.
For the Access to Land evaluation, NORC has been working closely with the Benin National Statistical Institute (INSAE), who collected baseline and follow-on data via the national Modular Study of Conditions of Life (EMICoV) study. The data collected by the EMICoV includes a large number of variables including household rosters, socioeconomic and demographic information, income, employment, consumption, detailed information on household plots and crops, informal sector activities, and qualitative data on respondent perceptions of key issues including the perceived value of land titles. NORC worked closely with INSAE to include additional items in the EMICoV that would be valuable for the evaluation.
For MCC's Access to Credit Program, NORC's evaluation is focused on six financial institutions whose primary clients are small and medium enterprises (SMEs) and small-scale agricultural producers. The component of the MCC Access to Credit programs that NORC is evaluating will fund beneficiary institutions to implement identical technical initiatives including:
- Interconnectivity among branches
- Installation of biometry devices at all branches
- Use of PC pocket devices to manage account data