2012 Frisch Medal Award

First awarded in 1978, the Frisch Medal is presented biennially for the best applied (empirical or theoretical) paper published in Econometrica during the previous five years. The purpose of the Frisch Medal is to encourage the submission to Econometrica of high quality empirical and applied work. The President appoints a committee to select the recipient for the award.


The selection committee for 2012 (Steven Durlauf, Chair; Douglas Bernheim; Nicholas Bloom; Michael Keane) awarded the Frisch Medal of the Econometric Society to Joseph P. Kaboski and Robert M. Townsend for their article, “A Structural Evaluation of a Large-Scale Quasi-Experimental Microfinance Initiative”, Econometrica, 79(5), September 2011, 1357-1406.


This paper provides a comprehensive analysis of the effects of the Thai Million Baht Village Fund program, a large scale microfinance intervention. A structural model is developed and its parameters are estimated using pre-program data. The estimated model is then used to understand the consequences of the microfinance intervention. Simulation of the model successfully matches the qualitative features of the post-program data and provides evidence of the role of credit constraints in household consumption decisions. The structural approach taken in the paper also allows for a cost benefit analysis of the microfinance program as compared to direct income transfers to households and shows that the microfinance program costs 30% more than a direct transfer program that would achieve the same average utility gain. The paper is noteworthy for its combination of rigorous theory and careful econometrics to produce important insights into a major development policy.

Publication Date: 
Saturday, June 30, 2012

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