Microsavings and Market Saturation: The Evolution of Diversity in Saving Products

Savings and Development, Vol. 36 (2012), pp. 109-135

28 Pages Posted: 4 Nov 2010 Last revised: 6 Jan 2017

See all articles by Philipp E. Otto

Philipp E. Otto

European University Viadrina

Arvind Ashta

CEREN EA 7477 Burgundy School of Business - Université Bourgogne Franche-Comté

Date Written: November 1, 2010

Abstract

Saving behavior influences economic development in many possible ways. The paradox of thrift stresses the negative effects of increased individual savings. How does this relationship transfer to microfinance and to microsavings in particular? Based on savings data of differently developed countries, we investigate the relationship described by the triangle of the availability of saving products, savings behavior, and development. The data supports the assumption of the proposed saturation triangle that with an increased number of MFIs active in a country, the average deposit per MFI decreases. Furthermore, the savings product saturation of a country is linked to economic as well as social developments.

Keywords: saving deposits, microfinance institutions, developmental research, technological change

JEL Classification: O22, O47, R11

Suggested Citation

Otto, Philipp E. and Ashta, Arvind, Microsavings and Market Saturation: The Evolution of Diversity in Saving Products (November 1, 2010). Savings and Development, Vol. 36 (2012), pp. 109-135. Available at SSRN: https://ssrn.com/abstract=1690524 or http://dx.doi.org/10.2139/ssrn.1690524

Philipp E. Otto (Contact Author)

European University Viadrina ( email )

Microeconomics Department
Grosse Scharrnstr. 59
D-15230 Frankfurt (Oder)
Germany

Arvind Ashta

CEREN EA 7477 Burgundy School of Business - Université Bourgogne Franche-Comté ( email )

29 rue Sambin
21000 Dijon
France

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