nep-mfd New Economics Papers
on Microfinance
Issue of 2017‒01‒29
four papers chosen by
Aastha Pudasainee and Olivier Dagnelie

  1. Mission Drift in Microcredit and Microfinance Institution Incentives By Sara Biancini; David Ettinger; Baptiste Venet
  2. Banking the Unbanked? Evidence from three countries By Pascaline Dupas; Dean Karlan; Jonathan Robinson; Diego Ubfal
  3. Assessing the impacts of a training program for women in Peru: Are There social networking effects? By Eduardo Zegarra; Angie Higuchi; Ricardo Vargas
  4. Preference for women but less preference for indigenous women: A lab-field experiment of loan discrimination in a developing economy By Rolando Gonzales; Gabriela Aguilera-Lizarazu; Andrea Rojas-Hosse; Patricia Aranda

  1. By: Sara Biancini (Universite de Caen Normandie, CREM); David Ettinger (Universite Paris Dauphine, PSL, LEDa and CEREMADE); Baptiste Venet (
    Abstract: We analyze the relationship between Micro nance Institutions (MFIs) and external donors, with the aim of contributing to the debate on \mission drift" in micro nance. We assume that both the donor and the MFI are pro-poor, possibly at different extents. Bor- rowers can be (very) poor or wealthier (but still unbanked). Incentives have to be provided to the MFI to exert costly effort to identify the more valuable projects and to choose the right share of poorer borrowers (the optimal level of poor outreach). We rst concentrate on hidden action. We show that asymmetric information can distort the share of very poor borrowers reached by loans, thus increasing mission drift. We then concentrate on hidden types, assuming that MFIs are characterized by unobservable heterogeneity on the cost of effort. In this case, asymmetric information does not necessarily increase the mission drift. The incentive compatible contracts push efficient MFIs to serve a higher share of poorer borrowers, while less efficient ones decrease their poor outreach.
    Keywords: Microfinance, Donors, Poverty, Screening.
    JEL: O12 O16 G21
    Date: 2017–01
  2. By: Pascaline Dupas; Dean Karlan; Jonathan Robinson; Diego Ubfal
    Abstract: We experimentally test the impact of expanding access to basic bank accounts in Uganda, Malawi, and Chile. Over two years, 17%, 10%, and 3% of treatment individuals made five or more deposits, respectively. Average monthly deposits for them were at the 79th, 91st, and 96th percentiles of baseline savings. Survey data show no clearly discernible intention-to-treat effects on savings or any downstream outcomes. This suggests that policies merely focused on expanding access to basic accounts are unlikely to improve welfare noticeably since impacts, even if present, are likely small and diverse. JEL Codes: C93; D14; G21; O16; O12 Keywords: financial access; savings; banking; micro-finance; field experiment; multicountry; Uganda; Malawi; Chile
    Date: 2016
  3. By: Eduardo Zegarra; Angie Higuchi; Ricardo Vargas
    Abstract: The general goal of this study is to assess the impacts on women’s economic and social participation of a peer-to-peer training program in Cañete Province, Peru. We use a quasi-experimental methodology applied to treatment and control groups. The study evaluates three areas of potential effects: (i) participation and returns from economic activities (use of time, labour market participation, family business, savings); (ii) indicators of women’s autonomy, family cohesion and social participation; and (iii) living standards. The impacts we found are mixed. We only detected robust impacts on the propensity to engage in savings and participate in local social organizations by treated women. The channels behind these impacts require more specific research, but we hypothesize that it may be related to expanded social networking. We observe a few specific impacts related to autonomy (negative) and family cohesion (positive), which can be linked to the religious nature of the program. We evaluate differentiated effects by some features of the treatment group as self-assessment of economic usefulness by women as well as trainers’ education and age. In terms of policy, we consider that peer-to-peer programs of this type may have limited impacts in terms of broad development goals like increased income, labour participation and business activity by women, but these can also show some advantages for expanding women’s social networking and access to savings and local organizations. Improved peer-to-peer programs more clearly linked to the economic advancement of women may be more efficient in achieving broader development goals.
    Keywords: Human Capital, Human Development, Human Resources, Formal Training Programs, Training, Skill Building, Specific Human Capital, Training, Occupational Choice; Labor Productivity
    JEL: O15 J24
    Date: 2017
  4. By: Rolando Gonzales; Gabriela Aguilera-Lizarazu; Andrea Rojas-Hosse; Patricia Aranda
    Abstract: A field experiment was performed in a controlled laboratory setting to evaluate whether credit officers reject micro-loan applications based on the ethnicity/gender of potential borrowers. Point estimates of a mixed-effects logistic regression suggest that, compared to non-indigenous men, non-indigenous women have two times more chance of loan approval, and indigenous women have 1.5 more chance of loan approval. The interval results regarding ethnic discrimination are inconclusive, however some evidence of taste-based discrimination in credit lending that was favorable for non-indigenous women was found.
    Keywords: Credit access, gender gaps, indigenous peoples, discrete choice, Bayesian analysis
    JEL: G21 J15 C25 C11
    Date: 2016

This nep-mfd issue is ©2017 by Aastha Pudasainee and Olivier Dagnelie. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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