التفاصيل البيبلوغرافية
| العنوان: |
SOCIAL CONNECTIONS AND GROUP BANKING. |
| المصدر: |
Economic Journal; Feb2007, Vol. 117 Issue 517, pF52-F84, 33p, 11 Charts |
| مصطلحات موضوعية: |
BANKING research, LOANS, POOR people, SOCIAL groups, REPAYMENTS, DEFAULT (Finance) |
| مستخلص: |
Lending to the poor is expensive due to high screening, monitoring and enforcement costs. Group lending advocates believe lenders overcome this by harnessing social connections. Using data from FINCA-Peru, I exploit a quasi-random group formation process to find evidence of peers successfully monitoring and enforcing joint-liability loans. Individuals with stronger social connections to their fellow group members (i.e.,either living closer or being of a similar culture) have higher repayment and higher savings. Furthermore, I observe direct evidence that relationships deteriorate after default, and that through successful monitoring, individuals know who to punish and who not to punish after default. [ABSTRACT FROM AUTHOR] |
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