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on Microfinance |
| By: | Mirko Bendig (GIGA German Institute of Global and Area Studies); Lena Giesbert (GIGA Institute of African Affairs); Susan Steiner (GIGA Institute of Latin American Studies) |
| Abstract: | This paper argues that the study of the demand for financial services in developing countries leaves out part of the story, if it looks at only one of the three elements of the so called finance trinity, i.e. savings products, loans, or insurances, as is largely done in the literature. In contrast to previous research, it is assumed that households’ choice for any of these services is strongly interconnected. Therefore, the paper simultaneously estimates the determinants of household demand for savings, loans and insurances by applying a multivariate probit model on household survey data from rural Ghana. On the one hand, the estimation results confirm the common finding that poorer households are less likely to participate in the formal financial sector than better off households. On the other hand, there is empirical evidence that the usage of savings products, loans and insurances does not only depend on the socio-economic status of households, but also on various other factors, such as households’ risk assessment and the past exposure to shocks. In addition, trust in the providing institution and its products appear to play a key role. |
| Keywords: | rural financial markets, financial services, Sub-Saharan Africa, Ghana |
| JEL: | G20 O16 R22 |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:gig:wpaper:94&r=mfd |
| By: | Becchetti, Leonardo (Associazione Italiana per la Cultura della Cooperazione e del Non Profit); Castriota, Stefano (Associazione Italiana per la Cultura della Cooperazione e del Non Profit) |
| Abstract: | Research on the nexus between life satisfaction and income has looked at lottery winners or postcommunism transition to document that exogenous changes in income generate effects of the same sign on happiness. In this paper we consider the unfortunate tsunami event as a negative lottery and examine the effects of the tsunami related income losses, net of the most ample possible set of concurring factors, on life satisfaction and self-esteem of a sample of Sri Lankan microfinance borrowers. Our empirical findings help to discriminate between various effects of material damages and monetary losses, both having strong significant impact on the dependent variables. Our contribution to the literature is in: i) identifying an exogenous shock which is temporary and does not suffer from voluntary participation bias (unfortunate "winners" of the negative lottery, exactly as control sample, did not decide to buy the lottery ticket); ii) testing the money-happiness nexus on a sample of individuals close to the poverty line. |
| Keywords: | life satisfaction; quasi natural experiment; tsunami; natural catastrophe |
| JEL: | I31 I32 |
| Date: | 2008–02–06 |
| URL: | http://d.repec.org/n?u=RePEc:ris:aiccon:2008_048&r=mfd |