ultimate information sources will be carried out by national statistical agencies (through censuses or household or enterprise surveys) or regulatory agencies or providers of other public services (through their administrative records). Examples of these are provided below.

# **2. Household users**

Surveys of households are at once the most direct and the most costly<sup>10</sup> way of discovering information about access to financial services. In general, members of the household do have most of the information, and not only on what financial services they use, with what frequency and at what cost. To be sure, the household member may not be willing to share that information, especially if probed about the size of their financial asset holdings, or indeed their indebtedness. And a single respondent (head of household) may not be fully informed about the services used by other members of the household. The desire for secrecy in these matters does complicate the information gathering exercise, and there can be significant reporting and response biases.<sup>11</sup> A key question is the relative merits of a stand-alone specialized financial services survey and the introduction of a financial module in a general household survey. The former has the attraction of allowing greater detail in the questionnaire instrument. Given the practical limitations on administering lengthy questionnaire instruments, a finance module embedded in an overall general purpose household survey will typically be limited to just a few questions. Also the sample frame can be adjusted to oversample groups or geographical areas of particular interest to the financial researcher.

On the other hand, a “finance-only” survey will naturally tend to be more costly than the finance component of a general survey, because it will be bearing all of the overheads. Furthermore, it will tend to offer a more limited range of non-financial control variables and correlates<sup>12</sup> , and as such the range of research questions that can be answered will be constrained and the reliability of those that can may be somewhat compromised.

The purpose for which the data is being collected will also color the choice between stand-alone and embedded surveys, and will also, of course, influence the questions that are to be included. If the focus is purely on market research aimed at understanding the scale and determinants of the demand for different financial services, a shorter (albeit more specialized) list of questions will likely suffice than if the focus is on the influence of different forms of financial market access on household poverty, or on the determinants of household access.

> 10 Justifying and quantifying this and other assertions about the relative cost of different modes of data collection is beyond the scope of the present paper, but should be an early priority. 11 When grossed-up to national totals, household surveys of financial asset holdings systematically understate the reality, mainly attributable to non-response bias (richer households refusing to participate) and to respondents falsely reporting zero holdings of certain assets).  Interestingly, where respondents reported non-zero holdings it seems (from circumstances in which independent verification was possible) that their reporting errors are unbiased (Ferber, 1965).

12 For instance, LSMS surveys ask hundred of questions and typically report in detail on health, education and employment status of each household member as well as on income and expenditure patterns. Most also ask about migration, fertility, agricultural activities and anthropometry (personal height, weight etc.).

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