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on Microfinance |
| By: | Sanjit Dhami; Junaid Arshad; Ali al-Nowaihi |
| Abstract: | Microfinance contracts have enormous economic and welfare significance. We study, theoretically and empirically, the problem of effort choice under individual liability (IL) and joint liability (JL) contracts when loan repayments are made either privately, or publicly in front of one’s social group. Our theoretical model identifies guilt from letting down the expectations of partners in a JL contract, and shame from falling short of normatively inadequate effort, under public repayment of loans, as the main psychological drivers of effort choice. Evidence from our lab-in-the-field experiment in Pakistan reveals large treatment effects and confirms the central roles of guilt and shame. Under private repayment, a JL contract increases effort by almost 100% relative to an IL contract. Under public repayment, effort levels are comparable under IL and JL contracts, which is consistent with recent empirical results. This indicates that shame-aversion plays a more important role as compared to guilt-aversion. Under IL, repayment in public relative to private repayment increases effort by 60%, confirming our shame-aversion hypothesis. Under JL, a comparison of private and public repayment shows that shame trumps guilt in explaining effort choices of borrowers. |
| Keywords: | microfinance, joint/individual liability, public/private repayment, belief-dependent motivations, guilt, shame, peer pressure, social capital, lab-in-the-field experiment |
| JEL: | C91 C92 D82 D91 G21 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7773&r=all |
| By: | Lisa Spantig |
| Abstract: | Cash is an important means of transaction, generally assumed to be fungible. However, behavioral economics and consumer research show that ‘cash in hand’, physically holding on to cash and then handing it away, affects purchasing decisions. I study how cash in hand influences decisions in a different but very important domain: savings. Savings accounts are a promising tool for reducing poverty, but the use of savings accounts is often puzzlingly low. Holding on to cash that needs to be physically deposited into a savings account may increase the psychological costs of saving. This study experimentally identifies the causal effect of cash in hand on savings deposits of microfinance clients in the Philippines. In contrast to many laboratory and several field studies with similar interventions, I do not find reduced savings deposits due to cash in hand. I discuss reasons for and consequence of this surprising finding, in particular for developing economics where lots of transactions are still cash-based. |
| Keywords: | cash, savings, experiment |
| JEL: | D90 C90 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7767&r=all |
| By: | Mingli Chen; Kengo Kato; Chenlei Leng |
| Abstract: | Data in the form of networks are increasingly available in a variety of areas, yet statistical models allowing for parameter estimates with desirable statistical properties for sparse networks remain scarce. To address this, we propose the Sparse $\beta$-Model (S$\beta$M), a new network model that interpolates the celebrated Erd\H{o}s-R\'enyi model and the $\beta$-model that assigns one different parameter to each node. By a novel reparameterization of the $\beta$-model to distinguish global and local parameters, our S$\beta$M can drastically reduce the dimensionality of the $\beta$-model by requiring some of the local parameters to be zero. We derive the asymptotic distribution of the maximum likelihood estimator of the S$\beta$M when the support of the parameter vector is known. When the support is unknown, we formulate a penalized likelihood approach with the $\ell_0$-penalty. Remarkably, we show via a monotonicity lemma that the seemingly combinatorial computational problem due to the $\ell_0$-penalty can be overcome by assigning nonzero parameters to those nodes with the largest degrees. We further show that a $\beta$-min condition guarantees our method to identify the true model and provide excess risk bounds for the estimated parameters. The estimation procedure enjoys good finite sample properties as shown by simulation studies. The usefulness of the S$\beta$M is further illustrated via the analysis of a microfinance take up example. |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1908.03152&r=all |
| By: | Molina, Patricia Celina; Goñi, M. Eugenia; Labrunée, María Eugenia; Cuneo, Verónica |
| Abstract: | La ponencia aborda el impacto del programa de microcrédito Banco Popular de la Buena Fe desde la percepción de los prestatarios y actores vinculados a su implementación. El estudio se circunscribe a su instrumentación desde la ONG ejecutora Sol de Mayo, institución vinculada desde hace más de seis años en el Partido de General Pueyrredon durante el año 2017. Interesa especialmente identificar las posibilidades ofrecidas a quienes participan del programa de generar espacios de pertenencia, procesos de organización popular y fortalecimiento de los valores de la Economía Social y Solidaria, el crecimiento de la economía familiar y acceso a la seguridad social. La investigación es exploratoria descriptiva y opta por una estrategia metodológica de tipo cualitativa por el carácter exploratorio de los objetivos y la intención de abordarlos desde el punto de vista y universo de significaciones de los participantes. Se utilizan técnicas de revisión bibliográfica y entrevistas individuales. Tradicionalmente los análisis sobre las políticas de microcréditos se vinculan específicamente a estudios de las tasas de recupero de los montos prestados. Aquí la propuesta es ahondar sobre los procesos sociales y trayectorias de las personas -en lo económico, pero también en su capital social, participación comunitaria y de aprendizajes individuales- que pudieron o podrían haberse modificado debido a su paso por dicho Programa. Se espera que la presente elaboración sea un aporte para comprender las relaciones entre las instituciones del Estado, las Políticas Públicas, las Organizaciones de la Sociedad Civil y los emprendedores, protagonistas de este esquema. |
| Keywords: | Economía Social; Microcréditos; Emprendedorismo; Partido de General Pueyrredon; |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nmp:nuland:3184&r=all |
| By: | Kraemer-Eis, Helmut; Botsari, Antonia; Gvetadze, Salome; Lang, Frank; Torfs, Wouter |
| Abstract: | This analysis provides an overview of the main markets relevant to the EIF. It starts by discussing the general market environment, then looks at the main aspects of equity finance and the guarantee and SME securitisation markets. It also highlights important aspects of microfinance in Europe. Finally, the analysis includes a chapter dedicated to Fintech. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:eifwps:201957&r=all |