Micro-finance competition: Motivated micro-lenders, double-dipping and default

• 成果类型: Article
• 署名作者: Guha, Brishti; Chowdhury, Prabal Roy
• 署名单位: Singapore Management University
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2013.07.006
• 发表日期: 2013
• 页码: 86-102
• 关键词: Micro-finance competition; Socially motivated MFIs; Double-dipping; default; Subsidized credit; Interest cap

摘要

We develop a tractable model of competition among socially motivated MFIs, so that the objective functions of the MFIs put some weight on their own clients' utility. We find that the equilibrium involves double-dipping, i.e. borrowers taking multiple loans from different MFIs, whenever the MFIs are relatively profit-oriented. Further, double-dipping necessarily leads to default and inefficiency, and moreover, borrowers who face relatively higher transactions costs optimally decide to double-dip. Interestingly, an increase in MFI competition can increase the extent of double-dipping and default. Further, the interest rates may go either way, with the interest rate likely to increase with more competition if the MFIs are very socially motivated. (C) 2013 Elsevier B.V. All rights reserved.