CREDIT DEMAND AND CREDIT RATIONING IN THE INFORMAL FINANCIAL SECTOR IN UGANDA1

This paper investigates the household and individual characteristics that influence the demand and supply of informal credit in Uganda, which credit is important for improving the welfare of the poor. Informal credit demand is positively and significantly influenced by age, sex, education level, dependency ratio, household expenditure, and regional location. On the supply side, informal lenders' credit rationing behaviour is negatively and significantly influenced by age, sex, asset values, and regional location. Government policies should focus on increasing both the productive capacity and wealth of households in order to enhance the poor's creditworthiness and make them less susceptible to credit rationing by lenders.     

THE BUDGET AND ECONOMIC POLICY*

The purpose of this paper is not so much to review the momentous budget introduced recently by the Minister of Finance as to use the opportunity it offers for appraising fiscal policy. A subsidiary purpose is to clear up some misunderstanding that seems to have arisen regarding the meaning of the term ‘cash budget’.