Search results

The purpose of this paper is to analyze the political effects of microcredit. The author provides the theoretical connections between microfinance and political empowerment and tests them in the context of Central Asia and the Caucasus, a region that is significantly lagging in political development and yet has a growing microfinance potential.

The author conducted a total of 100 in-depth interviews with microcredit clients in Kazakhstan and Azerbaijan in June 2010 and January 2011, respectively. The author chose my client samples randomly from two of the largest non-governmental microfinance institutions in these countries.

The findings of the survey reveal that microloans have only led to modest improvements in the socioeconomic status of the clients and had almost no effect on their political empowerment. Disaggregating the data further in terms of gender, type of loan and location of credit does not change the overall trends but reveals that to the extent that any political empowerment took place, group clients (mostly women) in urban settings were more aware and involved in political issues than individual clients in the villages.

Even with a carefully thought-out design, it is not clear how much the responses reflect the true and complicated impact of microfinance on the clients’ lives, a challenge that may be overcome in future research with focus group analysis or an ethnographic analysis of microcredit clients over a long period of time.

Notwithstanding these shortcomings, these observations can help inform microfinance institutions, donor organizations and governments about the true potential of microfinance. A realization of the limits of this unique development tool may prove useful in reorienting the goals of foreign aid and designing a more effective approach to development.

Despite the extensive literature on the economic and social effects of microcredit, very little attention has been given to how economic empowerment generated by microcredit can translate into political empowerment at the individual level. This paper lays out the theoretical reasons for why such a relationship might exist and tests these hypotheses systematically in two countries, taking into account gender, type of loan instrument and location of the loan.

Microcredit has become a popular tool for women's socioeconomic development across the globe. The purpose of this study is to examine the influences of gender ideology on women's microcredit participation and their status within the household in rural Bangladesh.

The study adopted a cross‐sectional design. Data were collected from 342 randomly selected married men in five northwest villages. A path analysis was conducted to test the hypothesized model.

Almost 52 percent of the married women were microcredit‐borrowers. However, in 81 percent of cases the loans were fully controlled by their husbands. This study indicates that low socioeconomic status influences women borrowing loans while conservative gender ideology constrain them from using the loans. It also appears that their husbands' liberal gender ideology facilitates women's use of loans (active microcredit participation), which in turn improves their status as household co‐breadwinner.

Though the study is based on men's reports and also correlational (not inferential) by nature, it provides a comprehensive understanding about the way microcredit intervention has been practiced in rural Bangladesh. This may have significant policy and practical implications.

The study discuses under what conditions microcredit intervention can contribute to improve women's status in rural Bangladesh. It is recommended that microcredit intervention should address patriarchal ideology by creating an environment where people may have a chance to re‐think the importance of women's roles and contributions.

The study is original in the linking of theory, policy and practice in the context of patriarchal ideology and microcredit interventions for enhancing women's status in rural Bangladesh.

The leading multinational companies tend to expand their marketing activities to bottom of pyramid (BOP) market. The BOP market comprises many segments, however, little is known about the purchase behaviour of BOP market or segments therein. Microcredit provides credit access to customers in BOP market. The purpose of this paper is to investigate youth’s intentions of obtaining microcredit in the post-war era, which could be a segment of BOP market.

The sample comprised 1,250 youth aged 18-27 selected from the Northern Province of Sri Lanka. Surveys were administered for data collection. After testing measurement model, two structural models – full model and non-mediated model (direct effects model) were run to test hypotheses.

Positive affect, subjective norms, entrepreneurial desire and self-identity enhanced intentions of obtaining microcredit, whereas perceived deterrents reduced those intentions. Additionally, self-identity mediated the association between positive affect, entrepreneurial desire, perceived behavioural control and knowledge of microcredit, and intentions of obtaining microcredit.

This study was conducted amongst youth in one country. Also, the data were cross-sectional. Hence, the model needs testing with youth and adults in other post-war contexts and with longitudinal data.

The findings of this study inform how effectively microcredit can be marketed to youth in post-war contexts and to the other segments of BOP market.

A unique purchase behavioural model is suggested with the mediating role of self-identity, to enhance intentions of obtaining microcredit in BOP markets, such as youth in post-war contexts. This study contributes to literature relating to purchase behaviour and self-identity, with particular reference to BOP market.

This study aims to direct war-affected youth’s self-identity towards microcredit. Youth is an important life stage for individuals’ self-identity formation. Features, labels and meanings associated with products can influence youth’s self-identity development.

A quantitative-survey method was used for data collection. The sample comprised 1,160 youth microcredit users aged between 18 and 24 years selected from the Northern Province of Sri Lanka. Analysis was conducted mainly in three steps, testing measurement model, hypotheses testing and testing for moderation effects.

The findings revealed that positive affect directed the youth’s self-identity towards microcredit, whereas perceived deterrents played a negative role. Knowledge of microcredit enhanced these attitudes. Also, entrepreneurial desire enhanced the association between positive affect and self-identity, and weakened the negative association between perceived deterrents and self-identity.

The data were cross-sectional and this study was conducted in one country. So, the model needs replication amongst youth in other war-affected countries and with longitudinal data. Additionally, this study is open for expansion by incorporating other constructs that can draw vulnerable youth’s self-identity around products.

This research suggests how war-affected youth’s self-identity can be drawn around microcredit.

This study proposes a unique conceptual model to draw vulnerable youth’s self-identity closer to products beneficial for their well-being, in this case, microcredit.

The purpose of this paper is to investigate factors affecting use of microcredit among farmers in Northern China.

A two-stage Heckman model is used to estimate the effect of farmer and family characteristics and loan and lending environment on likelihood of farmer participation in microcredit and the value of loans taken. Data from 342 first-hand observations in Northern China were used.

Social capital, production cost, non-labor family members, income, guarantee group membership, village head loan guarantee, and messenger use were found to increase use of microcredit. The same factors were found to affect the value of loans among participating farmers except a guarantor requirement for the loan replaces membership in a guarantee group.

Results support that there is demand for microcredit among farmers and that they are willing to take steps to obtain it including seeking membership in a household guarantee group. Identification of faced constraints facilitates understanding of supply-side efforts with potential to decrease financial exclusion with a focus on external-to-market intervention.

Pivotal findings are the importance of guarantee group membership for loan approval and that this requirement hinders farmers’ ability to obtain credit. Three alternatives are suggested to overcome this constraint including excluding low-risk borrowers from a group guarantee requirement; charging higher interest rates on high risk loans not supported by a guarantee; and development of insurance options to replace the guarantee.

The purpose of this paper is to determine the impact of microcredit on smallholder poultry production and its subsequent role on domestic protein and food supply.

Cross-sectional farm-level data from 61 farmers with at least two years of microcredit access and 39 farmers without microcredit access in the Dormaa Municipality of Ghana collected in 2016 via semi-structured questionnaire were used. Using the propensity score matching, PSM, and data envelopment analyses approaches, the authors analysed the propensity of farmers’ taking microcredit and its effect on beneficiaries’ technical efficiency, productivity, profitability and domestic production of chicken and eggs, farm performance. The authors addressed selection biases with the PSM and answered the research question of whether farmers with microcredit access perform better than non-microcredit farmers.

Farmers with high years of education, farming experience, technology and machinery as well as micro-savings and female farmers are more likely to take microcredit whereas large farm size reduces farmers’ propensity to take microcredit. Furthermore, farms with microcredit access were more technically efficient, productive and profitable than they would have been in the absence of microcredit.

The paper can be useful to policymakers and microcredit institutions since it provides evidence of microeconomic impacts of microcredit on agricultural production and the determinants of farmers’ participation in microcredit.

The study helps to understand how access to credit can improve smallholders’ technology adoption, production efficiency and productivity and output thereby enhancing domestic food supply.

This study investigates the welfare impact of microfinance on rural households in Indonesia. Its finding will bridge the gap in the Indonesian microfinance literature.

The research was conducted by collecting primary data and administering a structured questionnaire to rural households in Bantul District, Yogyakarta Province, Indonesia. We employed the logistic model to measure welfare impacts of microcredit borrowers.

The research finds that purpose of loan, monthly income, monthly expenditure, interest rates, loan amount, education and marital status have significant effects on the probability of increasing borrowers' welfare after accessing microcredit.

This study will propose some policy recommendations for Indonesian policymakers that may yield better strategies to help improve the impact of their microcredit programmes on the welfare of rural households.

The authors confirm that the article has not been submitted to peer review, nor is in the process of peer reviewing and nor has been accepted for publishing in another journal. The author(s) confirms that the research in their work is original, and that all the data given in the article are real and authentic.

The purpose of this paper is to analyze the impact of microcredit on per capita income of farm households in Cameroon. It discusses short- and long-term implications of access to microcredit on income poverty.

The authors interviewed rural households with agriculture being either their first or second income-creating activity. All sampled households are clients of a Cameroonian village bank. The authors used a balanced panel with a treatment and a control group, the latter not having had a village bank microcredit yet. The results were reaffirmed using bootstrapping.

This paper argues that microcredit has had a significant positive impact on per capita income in the short run, but the long-term effect was negative, albeit not significant. In the long run, absolute income poverty had further decreased in the treatment group, however, not as much as in the control group. Because the treatment group had been shifting back to the informal financial sector and had diverted part of the microcredit for consumption, this may have led to lower marginal income effects. Productivity of credit financed inputs by the treatment group remained constant, which also explains why the treatment group fell back over time.

The balanced panel data set was relatively small due to attrition over time. This was accounted for using bootstrapping. Nevertheless, research results must be interpreted with care. Furthermore, the discussion is not exhaustive.

Despite tremendous methodological advancements regarding the impact analysis of microcredit on income poverty, findings remain controversial and inconsistent. Frequently, fungibility is a confounding issue. Microcredit policy ought to consider more long-term effects.

There is much discourse amongst development economists about the impact of microcredit on poverty. Research based on panel data may clarify some of the controversial issues. This research paper uses a rather unique panel data set from Cameroonian farm households that are clients of a private sector village bank. The issue of sample size limitation is dealt with using bootstrapping. The authors base the empirical analysis on a comprehensive and theoretically founded economic farm household model.

Bottom of pyramid market (BOP) has gained attention of researchers and marketers in recent years. The BOP market comprises many segments, however, little is known about purchase behaviour in BOP market or segments therein. The purpose of this paper is to investigate youth's intentions of seeking microcredit in the post-war era that are an integral part of BOP market.

The sample comprised 1,250 youth aged 18 and above from Northern Province of Sri Lanka. Surveys were administered for data collection. After testing measurement model, a structural model was run to test hypotheses.

Positive affect, subjective norms and entrepreneurial desire enhanced intentions of seeking microcredit, whereas perceived deterrents negatively influenced those intentions. Perceived benefits, perceived behavioural control and knowledge of microcredit did not have significant effects on these intentions.

This study was conducted in one war-affected country, Sri Lanka. Also, data were cross-sectional. Hence the model needs replication amongst youth in other post-conflict contexts and with longitudinal data.

Findings of this study would be of use to market microcredit to youth in post-conflict era and other segments of BOP.

A unique purchase behavioural model is suggested to enhance youths’ intentions of seeking microcredit in the post-war era, a segment within the BOP market. This study can contribute to purchase behaviour literature in identified contexts.

This paper aims to evaluate the microcredit position in the performance of micro and small enterprises (MSEs). In the case of Malaysian MSEs, the paper also aims to examine other relevant factors, especially entrepreneur‐specific factors, which may be equally important for improving firm performance.

Primary data were collected from 756 MSE samples in Kelantan, the state where a large majority of the microcredit recipients under AIM and TEKUN run their business. Descriptive and multiple regression analyses were used to analyze the data.

Microcredit is positively and significantly related to the performance of MSEs across all the microcredit programs under investigation. Other entrepreneur‐specific factors, especially entrepreneurial values and management practices are equally significant for enhancing firm performance.

This study reminds policy makers, support institutions and small entrepreneurs that the microcredit program alone is not enough for improving the performance of MSEs. Besides microcredit, entrepreneur‐specific factors are equally important for firm performance. Thus, readjustment to the existing microcredit programs, especially on entrepreneurial and managerial developments, should be made so that entrepreneurial values and management competencies of the entrepreneurs could be enhanced from time to time for superior performance of MSEs.

This paper proves that microcredit is important for firm performance. It also reminds theorists and practitioners that entrepreneur‐specific factors should not be neglected in their theoretical or practical consideration of micro and small firm performance.