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on Microfinance |
| By: | Michal Bauer (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Julie Chytilová (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Jonathan Morduch (NYU) |
| Abstract: | This paper draws a link between self-control problems and the contractual mechanisms of microcredit. We use a series of “lab experiments in the field” which were designed to elicit measures of time discounting on a sample of 573 individuals in rural Karnataka, India. Evidence from the experiments were integrated with individual survey data on the economic and financial lives of villagers. One third of participants made choices consistent with hyperbolic preferences (more impatient now than in the future), and would be made better off if they could discipline their time inconsistent preferences. While hyperbolic preferences have been often associated with saving behavior, we describe links to borrowing as well. We find that “hyperbolic” women save a lower share of their savings at home and save less in total levels. Women with hyperbolic preferences are also more likely to borrow--and to do so through microcredit institutions specifically. The finding highlights the role of the fixed and frequent installment schedule ubiquitous in microcredit contracts. While microcredit contracts are celebrated for mitigating informational asymmetries, the evidence suggests that they also offer helpful structure for people with self-discipline problems who seek to accumulate capital but who lack suitable contractual saving devices. |
| Keywords: | banking; : time preference, hyperbolic discounting, loan contracts, microfinance |
| JEL: | C93 D91 O12 |
| Date: | 2008–11 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2008_28&r=mfd |
| By: | Hazarika, Gautam (University of Texas at Brownsville); Guha-Khasnobis, Basudeb (UNU-WIDER) |
| Abstract: | Using data from the 1995 Malawi Financial Markets and Food Security Survey, this study seeks to discover if women's relative control over household resources or intra-household bargaining power in rural Malawi, gauged by their access to microcredit, plays a role in children's food security, measured by anthropometric nutritional Z-scores. Access to microcredit is assessed in a novel way as self-reported credit limits at microcredit organizations. Since credit limits, that is, the maximum sums that might be borrowed, hinge upon supply-side factors such as the availability of credit programs and the financial resources of lenders, it is plausible they are more exogenous than demand driven loan uptake or participation in microcredit organizations, the common ways of gauging access to microcredit. It is indicated that whereas the access to microcredit of adult female household members improves 0–6 year old girls', though not boys', long-term nutrition as measured by height-for-age, the access to microcredit of male members has no such salutary effect on either girls' or boys' nutritional status. This may be interpreted as evidence of a positive relation between women's relative control over household resources and young girls' food security. That women's access to microcredit improves young girls' long-term nutrition may be explained in part by the subsidiary finding that it raises household expenditure on food. |
| Keywords: | intra-household distribution, bargaining, microcredit, gender, Malawi |
| JEL: | O15 |
| Date: | 2008–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3793&r=mfd |
| By: | Eduardo Zegarra; Javier Escobal; Ursula Aldana |
| Abstract: | This paper constructs a baseline and pursues an overall impact evaluation of the PETT (Programa Especial de Titulación de Tierras), an ambitious rural titling program created in Peru in 1992. The general evaluation of impacts on farmers shows a picture of not many positive effects, at least in the short period of the evaluation (2004-2006) and for a limited sample of farmers located in the Coast and Sierra regions. On average, most income variables (and income composition) do not seem to be impacted by titling, and there are no detectable effects on investments (except for permanent pasture in the Sierra) or other outcome variables, such as credit, land markets, or land conflicts. However, this general picture hides important impacts that may occur for some groups of farmers, or for farmers facing different constraints in the pre-intervention stage. Given the limitations, we investigated in more detail two important channels that are behind the potential impacts of rural titling programs: credit access and use of land rental markets. |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:2012&r=mfd |