Abstract

http://ssrn.com/abstract=2191135
 


 



It's Not What You Know, It's Who Knows What You Know: An Econometric Analysis of the Effectiveness of Microfinance in the Presence of Endogenous Peer Effects


Lisa Sundeen


Colorado College

Daniel K. N. Johnson


Colorado College - Department of Economics and Business

December 18, 2012

Colorado College Working Paper No. 2012-17

Abstract:     
This study shows how social capital affects the outreach and operational self-sufficiency of microfinance institutions (MFIs) around the world. Defining social capital as social networks, social norms, and trustworthiness, this research merges quantitative data from the Microfinance Information Exchange and World Values Survey to empirically test a which aspects of social capital have the greatest influence on MFI performance in the presence of an endogenous peer effect between MFIs. Regression results show that aspects of social capital have a direct influence on MFI performance, suggesting a tradeoff between outreach and sustainability, and display a strong endogenous peer effect.

Number of Pages in PDF File: 18

Keywords: Social Capital, Microfinance, Social Networks, Endogenous Peer Effect

JEL Classification: G21, F65

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Date posted: December 25, 2012  

Suggested Citation

Sundeen, Lisa and Johnson, Daniel K. N., It's Not What You Know, It's Who Knows What You Know: An Econometric Analysis of the Effectiveness of Microfinance in the Presence of Endogenous Peer Effects (December 18, 2012). Colorado College Working Paper No. 2012-17. Available at SSRN: http://ssrn.com/abstract=2191135 or http://dx.doi.org/10.2139/ssrn.2191135

Contact Information

Lisa Sundeen
Colorado College ( email )
14 East Cache La Poudre Street
Colorado Springs, CO 80903
United States
Daniel Kent Neil Johnson (Contact Author)
Colorado College - Department of Economics and Business ( email )
Colorado Springs, CO 80903
United States
719-389-6654 (Phone)
719-389-6927 (Fax)
HOME PAGE: http://faculty1.coloradocollege.edu/~djohnson
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