| By: |
Suman Ghosh (Department of Economics, College of Business, Florida Atlantic University);
Eric Van Tassel (Department of Economics, College of Business, Florida Atlantic University) |
| Abstract: |
In this paper we offer a theoretical examination of the phenomenon known as
mission drift. In recent years there have been claims that the entry of large
donors with deep pockets have led to a mission drift phenomenon, whereby
microfinance institutions who were previously catering to the poorest agents
have drifted towards catering to the less poor. We offer an explanation for
how the change in the lending portfolio of a poverty minimizing microfinance
institution might be linked to the phenomenon of increasing commercialization
through the advent of these large profit oriented donors. The degree to which
lending portfolios change turns out to be a function of both the supply of
donor funds and the strategic interaction between heterogeneous microfinance
institutions. |
| Keywords: |
microfinance; mission drift; poverty |
| JEL: |
O12 O16 G21 |
| Date: |
2008–12 |
| URL: |
http://d.repec.org/n?u=RePEc:fal:wpaper:08003&r=mfd |