nep-mfd 2024-11-11 papers

on Microfinance

Issue of 2024–11–11
two papers chosen by
Marco Novarese, Università degli Studi del Piemonte Orientale

A panel analysis of microfinance efficiency measures: Evidence on the effects of unobserved managerial ability By Fall, François Seck; Tchakoute Tchuigoua, Hubert; Vanhems, Anne; Simar, Léopold
Once Upon a Loan: How Folk Tales Shape Access to Credit By Jean-Baptiste Marigo; Laurent Weill

A panel analysis of microfinance efficiency measures: Evidence on the effects of unobserved managerial ability

By:	Fall, François Seck; Tchakoute Tchuigoua, Hubert; Vanhems, Anne; Simar, Léopold (Université catholique de Louvain, LIDAM/ISBA, Belgium)
Abstract:	This study analyzes the impact of unobserved heterogeneity on microfinance efficiency. Using panel data for 168 microfinance institutions (MFIs) over the period 20102015, we examine the persistence of the effect of unobserved heterogeneity on microfinance efficiency. Using recent nonparametric and robust techniques, we identify a latent heterogeneity factor related to the ability of MFI managers to promote efficiency, independent of MFI size, and analyze its impact on MFI inefficiency measures over time. We then assess the robustness of our results to several factors: the MFI status of the MFI (for-profit or nonprofit), the definition of the efficiency measure (social and financial) and an observed degree of heterogeneity captured by the percentage of women on the board. Finally, we analyze the relationship between our unobserved heterogeneity factor and institutional and socio-economic indicators.
Keywords:	OR in developing countries ; Microfinance ; Efficiency ; Unobserved heterogeneity ; Panel data ; Nonparametric robust frontier models
Date:	2024–08–29
URL:	https://d.repec.org/n?u=RePEc:aiz:louvad:2024020

Once Upon a Loan: How Folk Tales Shape Access to Credit

By:	Jean-Baptiste Marigo (LaRGE Research Center, Université de Strasbourg); Laurent Weill (LaRGE Research Center, Université de Strasbourg)
Abstract:	We investigate the effect of folklore on firms’ access to credit. Using firm-level data on a large sample of 38, 000 firms covering 124 countries and 274 cultural societies over the 2005-2022 period, we test the hypothesis that oral traditions linking risk-taking to success or failure influence access to credit. We find that folklore affects access to credit. Oral traditions associated with successful challenges increase access to credit, while those associated with unsuccessful challenges decrease access to credit. We further show that folklore influences access to credit through borrower discouragement and loan approval.
Keywords:	culture, folklore, access to credit, borrower discouragement.
JEL:	G21 O16 Z10 Z13
Date:	2024
URL:	https://d.repec.org/n?u=RePEc:lar:wpaper:2024-06

This nep-mfd issue is ©2024 by Marco Novarese. 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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