The first way is to look at the data and the available scientific studies and carefully assess the results. This is how central bankers typically approach economic questions. The second way is to pack your bags, hop on an airplane, and see for your self how microcredit affects the lives of people in developing countries.
Let’s start with the second approach, which is not so common for central bankers, but undoubtedly no less illuminating. My personal experience with microfinance in Ghana has been very positive. And this holds for many observers who have witnessed the activities of microfinance institutions on the ground. But is microcredit really an effective means to alleviate poverty?