Microfinance Games
Microfinance has been heralded as an effective way to address imperfections in credit markets. But from a theoretical perspective, the success of microfinance contracts has puzzling elements. In particular, the group-based mechanisms often employed are vulnerable to free-riding and collusion, although they can also reduce moral hazard and improve selection. The authors created an experimental economics laboratory in a large urban market in Lima, Peru and over seven months conducted 11 different games that allow them to unpack microfinance mechanisms in a systematic way. They find that risk-taking broadly conforms to predicted patterns, but that behavior is safer than optimal. The results help to explain why pioneering microfinance institutions have been moving away from group-based contracts.
Main Authors: | , , , |
---|---|
Language: | English |
Published: |
World Bank, Washington, DC
2006-07
|
Subjects: | ADVERSE SELECTION, AGENTS, BANKS, COMMERCIAL BANKS, CREDIT MARKETS, DEFAULT RISK, ECONOMICS, EXTERNALITIES, GAMES, INDUCEMENT, INSURANCE, INVENTORY, INVESTMENT CHOICES, JOINT LIABILITY, MICROFINANCE, MORAL HAZARD, PERFECT INFORMATION, PREPARATION, PROGRAMS, RATES, RECIPROCITY, RISK AVERSION, RISK OF DEFAULT, RISK TAKING, SAVINGS, SAVINGS ACCOUNTS, SIMULATIONS, SOCIAL COSTS, SOCIAL NETWORK, SOCIAL NETWORKS, TABLES, |
Online Access: | http://documents.worldbank.org/curated/en/2006/07/6952807/microfinance-games https://hdl.handle.net/10986/8368 |
Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
id |
dig-okr-109868368 |
---|---|
record_format |
koha |
spelling |
dig-okr-1098683682024-08-08T17:07:45Z Microfinance Games Jakiela, Pamela Giné, Xavier Karlan, Dean Morduch, Jonathan ADVERSE SELECTION AGENTS BANKS COMMERCIAL BANKS CREDIT MARKETS DEFAULT RISK ECONOMICS EXTERNALITIES GAMES INDUCEMENT INSURANCE INVENTORY INVESTMENT CHOICES JOINT LIABILITY MICROFINANCE MORAL HAZARD PERFECT INFORMATION PREPARATION PROGRAMS RATES RECIPROCITY RISK AVERSION RISK OF DEFAULT RISK TAKING SAVINGS SAVINGS ACCOUNTS SIMULATIONS SOCIAL COSTS SOCIAL NETWORK SOCIAL NETWORKS TABLES Microfinance has been heralded as an effective way to address imperfections in credit markets. But from a theoretical perspective, the success of microfinance contracts has puzzling elements. In particular, the group-based mechanisms often employed are vulnerable to free-riding and collusion, although they can also reduce moral hazard and improve selection. The authors created an experimental economics laboratory in a large urban market in Lima, Peru and over seven months conducted 11 different games that allow them to unpack microfinance mechanisms in a systematic way. They find that risk-taking broadly conforms to predicted patterns, but that behavior is safer than optimal. The results help to explain why pioneering microfinance institutions have been moving away from group-based contracts. 2012-06-18T21:25:59Z 2012-06-18T21:25:59Z 2006-07 http://documents.worldbank.org/curated/en/2006/07/6952807/microfinance-games https://hdl.handle.net/10986/8368 English Policy Research Working Paper; No. 3959 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank application/pdf text/plain World Bank, Washington, DC |
institution |
Banco Mundial |
collection |
DSpace |
country |
Estados Unidos |
countrycode |
US |
component |
Bibliográfico |
access |
En linea |
databasecode |
dig-okr |
tag |
biblioteca |
region |
America del Norte |
libraryname |
Biblioteca del Banco Mundial |
language |
English |
topic |
ADVERSE SELECTION AGENTS BANKS COMMERCIAL BANKS CREDIT MARKETS DEFAULT RISK ECONOMICS EXTERNALITIES GAMES INDUCEMENT INSURANCE INVENTORY INVESTMENT CHOICES JOINT LIABILITY MICROFINANCE MORAL HAZARD PERFECT INFORMATION PREPARATION PROGRAMS RATES RECIPROCITY RISK AVERSION RISK OF DEFAULT RISK TAKING SAVINGS SAVINGS ACCOUNTS SIMULATIONS SOCIAL COSTS SOCIAL NETWORK SOCIAL NETWORKS TABLES ADVERSE SELECTION AGENTS BANKS COMMERCIAL BANKS CREDIT MARKETS DEFAULT RISK ECONOMICS EXTERNALITIES GAMES INDUCEMENT INSURANCE INVENTORY INVESTMENT CHOICES JOINT LIABILITY MICROFINANCE MORAL HAZARD PERFECT INFORMATION PREPARATION PROGRAMS RATES RECIPROCITY RISK AVERSION RISK OF DEFAULT RISK TAKING SAVINGS SAVINGS ACCOUNTS SIMULATIONS SOCIAL COSTS SOCIAL NETWORK SOCIAL NETWORKS TABLES |
spellingShingle |
ADVERSE SELECTION AGENTS BANKS COMMERCIAL BANKS CREDIT MARKETS DEFAULT RISK ECONOMICS EXTERNALITIES GAMES INDUCEMENT INSURANCE INVENTORY INVESTMENT CHOICES JOINT LIABILITY MICROFINANCE MORAL HAZARD PERFECT INFORMATION PREPARATION PROGRAMS RATES RECIPROCITY RISK AVERSION RISK OF DEFAULT RISK TAKING SAVINGS SAVINGS ACCOUNTS SIMULATIONS SOCIAL COSTS SOCIAL NETWORK SOCIAL NETWORKS TABLES ADVERSE SELECTION AGENTS BANKS COMMERCIAL BANKS CREDIT MARKETS DEFAULT RISK ECONOMICS EXTERNALITIES GAMES INDUCEMENT INSURANCE INVENTORY INVESTMENT CHOICES JOINT LIABILITY MICROFINANCE MORAL HAZARD PERFECT INFORMATION PREPARATION PROGRAMS RATES RECIPROCITY RISK AVERSION RISK OF DEFAULT RISK TAKING SAVINGS SAVINGS ACCOUNTS SIMULATIONS SOCIAL COSTS SOCIAL NETWORK SOCIAL NETWORKS TABLES Jakiela, Pamela Giné, Xavier Karlan, Dean Morduch, Jonathan Microfinance Games |
description |
Microfinance has been heralded as an effective way to address imperfections in credit markets. But from a theoretical perspective, the success of microfinance contracts has puzzling elements. In particular, the group-based mechanisms often employed are vulnerable to free-riding and collusion, although they can also reduce moral hazard and improve selection. The authors created an experimental economics laboratory in a large urban market in Lima, Peru and over seven months conducted 11 different games that allow them to unpack microfinance mechanisms in a systematic way. They find that risk-taking broadly conforms to predicted patterns, but that behavior is safer than optimal. The results help to explain why pioneering microfinance institutions have been moving away from group-based contracts. |
topic_facet |
ADVERSE SELECTION AGENTS BANKS COMMERCIAL BANKS CREDIT MARKETS DEFAULT RISK ECONOMICS EXTERNALITIES GAMES INDUCEMENT INSURANCE INVENTORY INVESTMENT CHOICES JOINT LIABILITY MICROFINANCE MORAL HAZARD PERFECT INFORMATION PREPARATION PROGRAMS RATES RECIPROCITY RISK AVERSION RISK OF DEFAULT RISK TAKING SAVINGS SAVINGS ACCOUNTS SIMULATIONS SOCIAL COSTS SOCIAL NETWORK SOCIAL NETWORKS TABLES |
author |
Jakiela, Pamela Giné, Xavier Karlan, Dean Morduch, Jonathan |
author_facet |
Jakiela, Pamela Giné, Xavier Karlan, Dean Morduch, Jonathan |
author_sort |
Jakiela, Pamela |
title |
Microfinance Games |
title_short |
Microfinance Games |
title_full |
Microfinance Games |
title_fullStr |
Microfinance Games |
title_full_unstemmed |
Microfinance Games |
title_sort |
microfinance games |
publisher |
World Bank, Washington, DC |
publishDate |
2006-07 |
url |
http://documents.worldbank.org/curated/en/2006/07/6952807/microfinance-games https://hdl.handle.net/10986/8368 |
work_keys_str_mv |
AT jakielapamela microfinancegames AT ginexavier microfinancegames AT karlandean microfinancegames AT morduchjonathan microfinancegames |
_version_ |
1807157031040188416 |