Social Connections and Group Banking
Bibliographic Data
| ID | 9704416 |
|---|---|
| Authors | Dean S Karlan (Yale University), Dean Karlan (0000-0003-0164-1398, Yale University, corresponding author) |
| Year | 2007 |
| Volume | 117 |
| Issue | 517 |
| Pages | F52-F84 |
| Publication date | 2007-02-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Economic Journal (JOURNAL) |
| Journal identifiers | ISSN: 0013-0133 • E-ISSN: 1468-0297 |
| Publisher | Oxford University Press (OUP) (PUBLISHER) |
| DOI | 10.1111/j.1468-0297.2007.02015.x |
| OpenAlex | W2066593412 |
| Language | EN |
| Citations received | 71 |
| References cited | 37 |
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. Copyright 2007 The Author(s). Journal compilation Royal Economic Society 2007
Business · Computer security · Enforcement · Exploit · Group (periodic table · Joint and several liability · Legal liability · Liability · Political science · Process (computing · Finance · Islamic Finance and Banking Studies · Law · Microfinance and Financial Inclusion · Urban and Rural Development Challenges
Testing Evolutionary Theories of Human Cooperation via Meta-Analysis of Microfinance Repayment
Social Networks and Factor Markets
Social Capital and Access to Credit
The Role of Social Capital in Financial Development
The Economic Returns to Social Interaction
Do Television and Radio Destroy Social Capital? Evidence from Indonesian Villages
Microcredit Under the Microscope
Can collective action strategies motivate behaviour change to reduce open defecation in rural India?
Joint finance-based scheduling in construction
Social networks, household entrepreneurship, and relative poverty in rural China
Barriers and interventions on the way to empower women through financial inclusion
Knowledge creates value
Who gets the credit? Digitizing psychometric and character-based credit scoring in fintech microlending
Why Do People Become Fraud Victims? The Role of Credit Constraints in Urban China
Alice in land of games
Social capital, phone call activities and borrower default in mobile micro-lending
On Ethical Violations in Microfinance Backed Small Businesses
Crowdfunding and social capital
Micro‐credit NGOs and strategic trust
Uninsured Health Shocks and Agricultural Productivity among Rural Households
Agricultural Workers, Credit Rationing and Family Networks in Rural Mexico
External Social Ties and Loan Repayment of Group Lending Members
Do Risky Microfinance Borrowers Really Invest in Risky Projects? Experimental Evidence from Bolivia
The Benefits and Costs of Microfinance
Repaying Microcredit Loans
Network Based Social Capital and Individual Loan Repayment Performance
Self-Help Groups and Mutual Assistance
Banking on cooperation
The Effect of Social Connectedness on Crime
The Network Structure of Mutual Support Links
Ethnic divisions, contract choice, and search costs in the Guatemalan land rental market
The Social Rate of Return to Investing in Character
The Role of Microfinance in China’s Rural Public Health
They know each other, but do they trust each other? Social capital and selected beneficiaries of community-based development projects
Community-Based Enabling Models of Microfinance
How Should Rural Financial Cooperatives Be Best Organized? Evidence From Ethiopia
The potential of asset‐based development strategies for poverty alleviation in Sub‐Saharan Africa
Enforcement Problems in Roscas
Delving into the Determinants of Default Risk in Savings Groups
Social Capital Formation and Credit Access
Can the poor organize? Public goods and self-help groups in rural India
How Effective is a Big Push to the Small? Evidence from a Quasi-Experiment
Bridging the Gender Divide
Does political competition lessen ethnic discrimination? Evidence from Sri Lanka
The role of group size in group lending
Sequential lending with dynamic joint liability in micro-finance
Breaking the norm
Group insurance and lending with endogenous social collateral
Informal finance
Can micro-credit bring development
Rural transformation, inequality, and the origins of microfinance
Social Distance and Trust
Saving more in groups
Does social capital positively influence loan performance even during a crisis
Repayment performance in group lending
Lenders’ blind trust and borrowers’ blind spots
Influencing behaviour
Does Institutional Linkage of Bank‐ MFI Foster Inclusive Financial Development Even in the Presence of MFI Frauds
Financial performance and Outreach
Culture and Contracts
Market Structure and Borrower Welfare in Microfinance
The Empirics of Microfinance
Using Repayment Data to Test across Models of Joint Liability Lending
The Effect of Social Capital on Group Loan Repayment
Microcredit in Palestine (1995–2008)
Who Shares Risk with Whom under Different Enforcement Mechanisms
Networks in the Understanding of Economic Behaviors
Giving Credit Where It Is Due
Efeitos do microcrédito rural sobre a produção agropecuária na região Nordeste
Repayment Performance of Self-Help Groups in Uttar Pradesh
Able but Unwilling to Enforce
The Microfinance Promise
Thy Neighbor's Keeper
Financial Intermediation and Delegated Monitoring
Using Experimental Economics to Measure Social Capital and Predict Financial Decisions
Peer Monitoring and Credit Markets
The Role of Social Capital in Financial Development
The Determinants of Trust
Social Capital in the Creation of Human Capital
Social Capital
Misteri i Kapitalit
Demonstrated Benefits from Social Capital
Repayment performance in group-based credit programs in Bangladesh
The role of subsidies in microfinance
The economics of lending with joint liability
Group lending, local information and peer selection
Group lending, repayment incentives and social collateral
On the design of a credit agreement with peer monitoring
Political Jurisdictions in Heterogeneous Communities
Geographic Concentration in U.S. Manufacturing Industries
Peer Group Formation in an Adverse Selection Model
Can Social Cohesion be Harnessed to Repair Market Failures? Evidence from Group Lending in Guatemala
Financial performance and Outreach
Using Repayment Data to Test across Models of Joint Liability Lending
The Effect of Social Capital on Group Loan Repayment
Industrial Location and Protection
Does Social Capital Have an Economic Payoff? A Cross-Country Investigation
Measuring Trust
Determinants of Repayment Performance in Credit Groups
| Unique citing works | 71 |
|---|---|
| Citations per year | 3,23 |
| Citation span | 2004 - 2026 (23) |
| Citation velocity | current |
| Highly cited | No |
| Citation types | Neutral: 68 |