nep-mfd New Economics Papers
on Microfinance
Issue of 2019‒09‒30
two papers chosen by
Aastha Pudasainee and Olivier Dagnelie

  1. Economies of Diversification in Microfinance: Evidence from Quantile Estimation on Panel Data By Malikov, Emir; Hartarska, Valentina; Mersland, Roy
  2. Can Women’s Self-Help Groups Contribute to Sustainable Development? Evidence of Capability Changes from Northern India By Anand, Paul; Saxena, Swati; Gonzalez, Rolando; Dang, Hai-Anh H.

  1. By: Malikov, Emir; Hartarska, Valentina; Mersland, Roy
    Abstract: Prior studies of the diversification-driven cost savings from the joint provision of credit and deposits in microfinance usually ignore the multi-way heterogeneity across MFIs which vary substantially in size, business model, target clientele and operate in diverse environments. Using a quantile panel data model with correlated effects capable of accommodating multiple heterogeneity, we show that the typical measurement of economies of diversification at the mean provides an incomplete and distorted picture of their magnitude and prevalence in the industry. While we find statistically significant estimates, they are modest for most small-size MFIs but are quite substantial for large-scale institutions.
    Keywords: cost, diversification, microfinance institutions, quantile regression
    JEL: G15 G21 L33 O16
    Date: 2019
  2. By: Anand, Paul; Saxena, Swati; Gonzalez, Rolando; Dang, Hai-Anh H.
    Abstract: This paper investigates a women’s self-help group program with more than 1.5 million participants in one of the poorest rural areas of Northern India. The program has four streams of activity in micro-savings, agricultural enterprise training, health and nutrition education, and political participation. The paper considers whether there is any evidence that program membership is associated with quality of life improvement. Using new data on a variety of self-reported capability indicators from members and non-members, the paper estimates propensity score matching models and reports evidence of differences in some dimensions as well as significant benefits to those from the most disadvantaged groups—scheduled castes and tribes. The paper considers robustness and concludes that for some dimensions, there is evidence that the program has contributed to sustainable development through improvements in the quality of life.
    Keywords: capabilities,self-help groups,sustainable development,propensity score matching
    JEL: I31 I32
    Date: 2019

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