nep-mfd New Economics Papers
on Microfinance
Issue of 2021‒10‒04
four papers chosen by
Olivier Dagnelie
Université de Caen

  1. Big Loans to Small Businesses: Predicting Winners and Losers in an Entrepreneurial Lending Experiment By Gharad T. Bryan; Dean Karlan; Adam Osman
  2. Macro-scaled Microcredit and Constraints on Household Business Development: Evidence from Northern Thailand By Archawa Paweenawat; Narapong Srivisal
  3. Leveraging technology to promote women's health: Evidence from a pilot program By Ahmad, Hamna; Hussain, Sadia; Nazif, Muhammad Ahmed
  4. Is Islamic Finance Evolving Into Fintech and Blockchain: A Bibliometric Analysis By Ahmet Aysan; Ibrahim Musa Unal

  1. By: Gharad T. Bryan; Dean Karlan; Adam Osman
    Abstract: We experimentally study the impact of substantially larger enterprise loans, in collaboration with an Egyptian lender. Larger loans generate small average impacts, but machine learning using psychometric data reveals dramatic heterogeneity. Top-performers (i.e., those with the highest predicted treatment effects) substantially increase profits, whereas profits for poor-performers drop. The magnitude of this difference implies that an individual lender’s credit allocation choices matter for aggregate income. Evidence on two fronts suggests large loans would be misallocated: top-performers are predicted by loan officers to have higher default rates; and, top-performers grow less than others when given small loans, implying that allocating larger loans based on prior performance is not efficient. Our results have important implications for credit expansion policy and our understanding of entrepreneurial talent: on the former, the use of psychometric data to identify top-performers suggests a pathway towards better allocation that revolves around entrepreneurial type more than firm type; on the latter, the reversal of fortune for poor-performers, who do well with small loans but not large, indicates a type of entrepreneur that we call a “go-getter” who performs well when constrained but poorly when not.
    JEL: D22 D24 L26 M21 O12 O16
    Date: 2021–09
  2. By: Archawa Paweenawat (Bank of Thailand); Narapong Srivisal (Chulalongkorn University)
    Abstract: This paper studies impacts of One-Million-Baht Village Fund program on entrepreneurial activities of households in northern Thailand. In addition to being one of the largest-scaled microfinance programs to date, the implementation of the Village Fund program provides us with an exogenous variation in the availability of microcredit per household that can be used to form an instrumental variable. We apply our unique dataset, containing the instrument and a precise measure of the extent to which household businesses are financially constrained, to estimate Probit models that are subject to the problem of endogenous borrowing decisions. We find evidence for the positive impacts of the Village Fund program on relieving financial constraints faced by household businesses, but the impacts on business startup rates are not significant. Our findings offer policy implications on improving effectiveness of microfinance programs in promoting household businesses.
    Keywords: Entrepreneurship, Financial Constraints, Microfinance, Village Funds
    JEL: G21 G51 O16
    Date: 2021–09
  3. By: Ahmad, Hamna; Hussain, Sadia; Nazif, Muhammad Ahmed
    Abstract: We investigate the causal impact of offering telehealth services to female microfinance borrowers on their health and bargaining power in the household. Using a balanced panel of 1218 female borrowers, we observe a positive impact of offering telehealth services on self-reported physical and mental health of treated relative to control women. Treated women seek healthcare more proactively; they are more likely to consult a doctor and they do so sooner, as compared to control women. In addition, treated women report greater inclusion in household decision-making. We also find positive spillover effects of offering telehealth services within the household, where we observe a greater likelihood of the spouse and children (of treated women) to seek health care.
    Keywords: health microinsurance,telehealth,physical health,mental health,Pakistan
    Date: 2021
  4. By: Ahmet Aysan (HBKU - Hamad Bin Khalifa University); Ibrahim Musa Unal (HBKU - Hamad Bin Khalifa University)
    Abstract: This paper conducts a bibliometric research in the literature on Fintech and Islamic finance. The data of this study consists of relevant articles obtained from the Scopus database as of February 2021. A keywords bundle related to Islamic finance and keyword has been used for the search, resulting in 89 publishments included in this research. Results show the stunning increase in the Islamic Fintech publishments after 2017, mainly in the fields of cryptocurrencies, micro-finance, impact investing, and SRI investing, and so on. The two main centers of Islamic Fintech research are Malaysia-Indonesia Region and the GCC area. The increasing number of Islamic Fintech publishments show the potential of the field for the industry's future.
    Keywords: blockchain,cryptocurrency,bibliometric,Islamic,Fintech
    Date: 2021

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