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on Microfinance |
| By: | Daniel J. Hernandez (Université Paris Saclay, Ecole Normale Supérieure Paris-Saclay, CEPS); Fernando Jaramillo (Universidad del Rosario, Bogota, Colombia); Hubert Kempf (Université Paris Saclay, Ecole Normale Supérieure Paris-Saclay, CEPS); Fabien Moizeau (Université de Rennes, CNRS, CREM-UMR6211, F-35000 Rennes, France); Thomas Vendryes (Université Paris Saclay, Ecole Normale Supérieure Paris-Saclay, CEPS) |
| Abstract: | The need to insure against idiosyncratic income risk leads to the formation of risksharing groups in village economies where formal financial markets are absent. We develop a theoretical model to address the impact of limited commitment and social control on the extent of informal risk sharing when agents are induced to form such risk-sharing coalitions. Social control increases the prospect of future punishment of present defectors and thus mitigates the absence of commitment. A defection-proof core-partition exists, is unique and homophilic. Riskier societies may not be more segmented and may not pay a higher cost for insurance. A higher social control leads to a less segmented society but does not necessarily lead to a lower price for sharing risk. We provide evidence, based on data on Thai villages, that consumption smoothing conforms with our theoretical result of homophily-based coalitions and that social control contributes to a lesser segmentation of a society. |
| Keywords: | Risk Sharing, Informal Insurance, Group Formation, Social Control, Risk Heterogeneity, Homophily, Dyadic Models, Thailand |
| JEL: | C71 D81 O12 O17 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:2023-03&r=mfd |
| By: | Lahrour Khalid (UH2MC - Université Hassan II [Casablanca]) |
| Abstract: | The banking crises in many developing countries have prompted discussions about necessary reforms in the financial sector. This has led to a resurgence of interventionist public policies that focus on the financial sector and are deployed through interactions with other collective or individual actors. As a result, providing banking services to a wider clientele through financial inclusion as a public good has become a topic of political debate and a public policy agenda (Sodokin Koffi, 2022). This is because excluding people from accessing financial services is not considered a public good in economic terms (Desmarais-Tremblay, 2017; Ülgen, 2020). International opinion is re-examining the need for government intervention in certain economic sectors in the face of the challenges associated with the Millennium Goals. This trend is also reflected in the words of the World Bank, which, while persisting in its support for the neoclassical model of state disengagement and the primacy of the market, is now more inclined to place greater emphasis on a redistributive model that incorporates a social dimension into public policy. This paper looks at interventionist public policies for financial inclusion in two regions, Latin America and Asia, to present the different contributions and limitations of programs and policies for developing access to finance and the use of financial supply by the excluded from formal finance and the vulnerable population in India, Mexico and Peru to focus on the role of public actors and how this translates into financial supply in the face of financial inclusion issues. The methodology used in this paper consists of a literature review of financial inclusion policies and programs in India, Mexico and Peru. The study is based on qualitative and quantitative data available in official reports, academic publications and research conducted by governmental and non-governmental organizations. |
| Abstract: | Les crises bancaires dans de nombreux pays en développement ont suscité des discussions sur les réformes nécessaires dans le secteur financier. Cela a conduit à une réapparition de politiques publiques interventionnistes qui se concentrent sur le secteur financier et qui se déploient via des interactions avec des acteurs collectifs ou individuels. En conséquence, le fait d'offrir des services bancaires à une clientèle plus large grâce à l'inclusion financière en tant que bien public est devenu un sujet de débat politique et un programme de politique publique (Sodokin Koffi, 2022). Cela est dû au fait qu'exclure des personnes de l'accès aux services financiers n'est pas considéré comme un bien public sur le plan économique (Desmarais-Tremblay, 2017 ; Ülgen, 2020). L'opinion internationale est en train de réexaminer la nécessité d'intervention gouvernementale dans certains secteurs économiques face aux défis liés aux objectifs du millénaire.Cette tendance se reflète également dans les propos de la Banque mondiale, qui, tout en persistants dans son soutien au modèle néoclassique de désengagement de l'État et de primauté du marché, est maintenant plus encline à accorder plus d'importance à un modèle redistributif qui intègre une dimension sociale dans les politiques publiques. Cet article s'intéresse aux politiques publiques interventionnistes en matière d'inclusion financière dans deux régions, l'Amérique latine et l'Asie, il s'agira de présenter des différents apports et limites des programmes et politiques de développement d'accès au financement et l'usage de l'offre financière par les exclus de financement formel et la population vulnérable en Inde, Mexique et Pérou afin de mettre en évidence le rôle des acteurs publics et la façon dont cela se reflète dans l'offre financière en réponse aux défis de l'inclusion financière. La méthodologie utilisée dans cet article consiste en une revue de la littérature sur les politiques et programmes de l'inclusion financière en Inde, au Mexique et au Pérou. Cette étude se base sur des données qualitatives et quantitatives disponibles dans les rapports officiels, les publications universitaires et les recherches menées par des organisations gouvernementales et non gouvernementales. |
| Keywords: | Public Policy, Financial Inclusion, Financial Exclusion, Microfinance, Poverty, Growth., Politique publique, Inclusion financière, Exclusion financière, Pauvreté, Croissance |
| Date: | 2023–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04014943&r=mfd |
| By: | Ciula, Raffaele |
| Abstract: | Poverty has always been a sensitive issue in Japan, in fact the first official statistics on this phenomenon have been released late in time compared to many developed countries. Similarly, the most important Japanese public assistance scheme is quite narrow, stigmatizing and discretionary, which suggests a cautious attitude towards poverty and the poor. In this regard, the scholars have pointed out some factors associated with poverty, such as income, employment, and education, but the association between financial characteristics of Japanese people and poverty is still under-researched. As financial inclsion has always been an important feature in Japan, and can be an important driver of poverty avoidance, the goal of this article is about inspecting the role of formal and informal financial instruments, including the ability to save, in reducing the likelihood of falling into poverty. Also, it analyzes the role of financial access in decreasing the detrioration of being well-off in Japan, using the World Bank dataset, and employing a logit regression analysis. The main findings of this article show that formal financial instruments, the savings capacity, and tertiary education are important drivers of reducing the probability of falling into poverty. Similarly, education, and financial instruments play a pivotal role in avoiding the movement from being well-off to becoming middle-class in Japan. Therefore, this article suggests that savings, the education system, and financial instruments are still a buffer against poverty in Japan. Further, it points out that probably public interventions which encourage financial inclusion should be strengthened. |
| Keywords: | Poverty; Savings; Financial Determinants, Education; Capabilities |
| JEL: | D60 |
| Date: | 2023–03–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:116760&r=mfd |
| By: | Ashima Goyal (Indira Gandhi Institute of Development Research) |
| Abstract: | We examine predictions and outcomes for the Indian financial sector in the pandemic period to build a case for re-examining our understanding of the sector. This can improve risk perceptions and policy design. Reasons for outperformance include reforms that led to a better balance between discretion from public sector dominance and the excess volatility of market-based systems. This diversity, as well as divergence of the Indian credit cycle from the global credit cycle, was protective given the sustained external risks. It put the Indian financial sector in a position to support the domestic recovery, despite global quantitative tightening. There are lessons from India's more broad-based regulation for the narrow bank-based regulation in advanced economies (AEs), which is increasing global financial fragilities and risks. It is also increasing the share of markets in the AE financial sector so much that diversity is falling. Public sector banks contribute to the diversity of the Indian financial sector. Non-bank financial companies reach the unbanked sectors and improve financial inclusion. Regulatory excesses and absence of liquidity support contributed to persistence of financial stress. Policy lessons are for countries to avoid policy over-reaction, aim for diversity, different types of exposures, uniformity in financial sector regulation, with appropriate balance between discipline and support, in order to reduce risks. |
| Keywords: | Outperformance, Indian financial sector, Diversity, Credit cycle, Broad-based regulation |
| JEL: | O16 G15 G18 F36 F42 |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:ind:igiwpp:2023-002&r=mfd |