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Membership has its privileges: the effect of social capital and neighbourhood characteristics on the earnings of microfinance borrowers

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Author Info
Rafael Gomez
Eric Santor

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Abstract

In this paper we examine the determinants of self-employment success for microcredit borrowers. Theories of social capital and neighbourhood effects are integrated in an attempt to account for earnings differentials among a unique sample of microfinance borrowers. We posit that social capital - social relations that facilitate individual action - is essential for microentrepreneurial success. Based on a survey and data collected by the authors, it is demonstrated that social capital is a positive determinant of self-employment earnings. The role that neighbourhoods play in fostering social capital and improving microentrepreneurial performance are also highlighted.

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File URL: http://economics.ca/cgi/xms?jab=v34n4/06.pdf
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Publisher Info
Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 34 (2001)
Issue (Month): 4 (November)
Pages: 943-966
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Handle: RePEc:cje:issued:v:34:y:2001:i:4:p:943-966

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Postal: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4
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Web page: http://economics.ca/cje/
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Web: http://economics.ca/en/membership.php

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Related research
Keywords:

Find related papers by JEL classification:
J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
O17 - Economic Development, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
Z13 - Other Special Topics - - Cultural Economics - - - Social Norms and Social Capital; Social Networks Economic Anthropology

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Jean-François Maystadt, 2004. "Microfinance au Nord : Un effet de mode importé du Sud ?," Mondes en développement, De Boeck Université, vol. 126(2), pages 69-82. [Downloadable!]
  2. Rafael Gomez & Eric Santor, 2003. "Do Peer Group Members Outperform Individual Borrowers? A Test of Peer Group Lending Using Canadian Micro-Credit Data," Working Papers 03-33, Bank of Canada. [Downloadable!]
  3. Stuart, Guy, 2006. "Caste Embeddedness and Microfinance: Savings and Credit Cooperatives in Andhra Pradesh, India," Working Paper Series rwp06-037, Harvard University, John F. Kennedy School of Government. [Downloadable!]
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This page was last updated on 2009-11-25.


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