IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v14y2022i5p3130-d766030.html
   My bibliography  Save this article

Green Microfinance and Women’s Empowerment: Why Does Financial Literacy Matter?

Author

Listed:
  • Cheng-Wen Lee

    (Department of International Business, College of Business, Chung Yuan Christian University, 200 Zhong Bei Rd, Taoyuan 32023, Taiwan)

  • Andrian Dolfriandra Huruta

    (Ph.D. Program in Business, College of Business, Chung Yuan Christian University, 200 Zhong Bei Rd, Taoyuan 32023, Taiwan
    Department of Economics, Faculty of Economics and Business, Satya Wacana Christian University, 52-60 Diponegoro Rd, Salatiga 50711, Indonesia)

Abstract

This study investigated the role of financial literacy in the relationship between women’s empowerment and green microfinance. We set a conceptual model with green microfinance as an outcome variable, financial literacy as a mediating variable, and women’s empowerment as an exposure variable. Variance-based SEM was employed for analysis. The results show that the exposure and mediating variables have a significant direct and indirect impact on the outcome variable. The relationship between women’s empowerment and green microfinance is partially mediated by financial literacy. Local wisdom-based financial literacy is found to be an alternative for mainstreaming women’s empowerment in local development. In addition, gender-targeted programs need to consider pro-literacy policies for achieving green microfinance sustainability. By using financial literacy as a mediating variable, this study contributes to the current literature on the relationship between women’s empowerment and green microfinance.

Suggested Citation

  • Cheng-Wen Lee & Andrian Dolfriandra Huruta, 2022. "Green Microfinance and Women’s Empowerment: Why Does Financial Literacy Matter?," Sustainability, MDPI, vol. 14(5), pages 1-13, March.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:5:p:3130-:d:766030
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/14/5/3130/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/14/5/3130/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Agrawala, Shardul & Carraro, Maelis, 2010. "Assessing the Role of Microfinance in Fostering Adaptation to Climate Change," Sustainable Development Papers 92709, Fondazione Eni Enrico Mattei (FEEM).
    2. Boehe, Dirk Michael & Barin Cruz, Luciano, 2013. "Gender and Microfinance Performance: Why Does the Institutional Context Matter?," World Development, Elsevier, vol. 47(C), pages 121-135.
    3. Tabea Bucher-Koenen & Rob Alessie & Annamaria Lusardi & Maarten van Rooij, 2021. "Fearless Woman. Financial Literacy and Stock Market Participation," Working Papers 708, DNB.
    4. Supriya Garikipati, 2012. "Microcredit and Women's Empowerment: Through the Lens of Time-Use Data from Rural India," Development and Change, International Institute of Social Studies, vol. 43(3), pages 719-750, May.
    5. Shahidur R. Khandker, 2005. "Microfinance and Poverty: Evidence Using Panel Data from Bangladesh," The World Bank Economic Review, World Bank, vol. 19(2), pages 263-286.
    6. Susanna Khavul & Garry D. Bruton & Eric Wood, 2009. "Informal Family Business in Africa," Entrepreneurship Theory and Practice, , vol. 33(6), pages 1219-1238, November.
    7. Demirguc-Kunt,Asli & Klapper,Leora & Singer,Dorothe & Van Oudheusden,Peter, 2015. "The Global Findex Database 2014 : measuring financial inclusion around the world," Policy Research Working Paper Series 7255, The World Bank.
    8. Moser, Rafael Magnus Barbosa & Gonzalez, Lauro, 2016. "Green microfiance: a new frontier to inclusive financial service," RAE - Revista de Administração de Empresas, FGV-EAESP Escola de Administração de Empresas de São Paulo (Brazil), vol. 56(2), March.
    9. Shardul Agrawala & Maëlis Carraro, 2010. "Assessing the Role of Microfinance in Fostering Adaptation to Climate Change," OECD Environment Working Papers 15, OECD Publishing.
    10. Lee Cronbach, 1951. "Coefficient alpha and the internal structure of tests," Psychometrika, Springer;The Psychometric Society, vol. 16(3), pages 297-334, September.
    11. Shardul Agrawala & Maëlis Carraro, 2010. "Assessing the Role of Microfinance in Fostering Adaptation to Climate Change," Working Papers 2010.82, Fondazione Eni Enrico Mattei.
    12. Sam Allgood & William B. Walstad, 2016. "The Effects Of Perceived And Actual Financial Literacy On Financial Behaviors," Economic Inquiry, Western Economic Association International, vol. 54(1), pages 675-697, January.
    13. Lisa Marini & Jane Andrew & Sandra van der Laan, 2018. "Accountability practices in microfinance: cultural translation and the role of intermediaries," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 31(7), pages 1904-1931, September.
    14. Like Soegiono & Apriani Dorkas Rambu Atahau & Harijono & Andrian Dolfriandra Huruta, 2019. "Local wisdom in rural microfinance: a descriptive study on villagers of East Sumba," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 6(3), pages 1485-1496, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Terfa W. Abraham & William M. Fonta, 2018. "Climate change and financing adaptation by farmers in northern Nigeria," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 4(1), pages 1-17, December.
    2. Castells-Quintana, David & del Pilar Lopez-Uribe, Maria & McDermott, Thomas K.J., 2018. "A review of adaptation to climate change through a development economics lens," Working Papers 309605, National University of Ireland, Galway, Socio-Economic Marine Research Unit.
    3. Karl Harvey Schultz, 2012. "Financing climate adaptation with a credit mechanism: initial considerations," Climate Policy, Taylor & Francis Journals, vol. 12(2), pages 187-197, March.
    4. Azad, Md Javed & Pritchard, Bill, 2022. "Financial capital as a shaper of households' adaptive capabilities to flood risk in northern Bangladesh," Ecological Economics, Elsevier, vol. 195(C).
    5. Davide Forcella & Rafael Moser & Lauro Emilio Gonzales Farias, 2016. "Rural Microfinance and Climate Change: Geographical Credits Allocation and Vulnerability. An Analysis of Agroamigo in Brazil’s Northeastern States," Working Papers CEB 16-011, ULB -- Universite Libre de Bruxelles.
    6. Castells-Quintana, David & Lopez-Uribe, Maria del Pilar & McDermott, Thomas K.J., 2018. "Adaptation to climate change: A review through a development economics lens," World Development, Elsevier, vol. 104(C), pages 183-196.
    7. Rafael Moser & Davide Forcella & Lauro Emilio Gonzales Farias, 2016. "Microfinance and climate change: threats and opportunities, the case of Brazil’s largest rural MFIs, Agroamigo and Cresol," Working Papers CEB 16-010, ULB -- Universite Libre de Bruxelles.
    8. Fenton, Adrian & Paavola, Jouni & Tallontire, Anne, 2017. "The Role of Microfinance in Household Livelihood Adaptation in Satkhira District, Southwest Bangladesh," World Development, Elsevier, vol. 92(C), pages 192-202.
    9. Namita Vikas & Smitha Hari, 2023. "Innovative Financing Mechanisms to Leverage Ecosystem Based Adaptation (EbA) Finance for Vulnerable Communities," Global Economic Observer, "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences;Institute for World Economy of the Romanian Academy, vol. 11(1), pages 116-125, May.
    10. Heuson, Clemens & Gawel, Erik & Gebhardt, Oliver & Hansjürgens, Bernd & Lehmann, Paul & Meyer, Volker & Schwarze, Reimund, 2012. "Ökonomische Grundfragen der Klimaanpassung: Umrisse eines neuen Forschungsprogramms," UFZ Reports 02/2012, Helmholtz Centre for Environmental Research (UFZ).
    11. Oberlack, Christoph & Neumärker, Bernhard, 2013. "A diagnostic approach to the institutional analysis of climate adaptation," The Constitutional Economics Network Working Papers 01-2013, University of Freiburg, Department of Economic Policy and Constitutional Economic Theory.
    12. Nicole D. Peterson, 2012. "Developing Climate Adaptation: The Intersection of Climate Research and Development Programmes in Index Insurance," Development and Change, International Institute of Social Studies, vol. 43(2), pages 557-584, March.
    13. Heuson, Clemens & Gawel, Erik & Gebhardt, Oliver & Hansjürgens, Bernd & Lehmann, Paul & Meyer, Volker & Schwarze, Reimund, 2012. "Fundamental questions on the economics of climate adaptation: Outlines of a new research programme," UFZ Reports 05/2012, Helmholtz Centre for Environmental Research (UFZ).
    14. Khan, Tahsina & Khanam, Shamsun Nahar & Rahman, Md Habibur & Rahman, Syed Mahbubur, 2019. "Determinants of microfinance facility for installing solar home system (SHS) in rural Bangladesh," Energy Policy, Elsevier, vol. 132(C), pages 299-308.
    15. Oberlack, Christoph & Neumärker, Bernhard, 2011. "Economics, institutions and adaptation to climate change," The Constitutional Economics Network Working Papers 04-2011, University of Freiburg, Department of Economic Policy and Constitutional Economic Theory.
    16. Kifayat Ullah & Abdul Qayyum Mohsin & Abdul Saboor & Saranjam Baig, 2020. "Financial Inclusion, Socioeconomic Disaster Risks and Sustainable Mountain Development: Empirical Evidence from the Karakoram Valleys of Pakistan," Sustainability, MDPI, vol. 12(22), pages 1-26, November.
    17. Renata Baborska & Emilio Hernandez & Emiliano Magrini & Cristian Morales-Opazo, 2020. "The impact of financial inclusion on rural food security experience: A perspective from low-and middle-income countries," Review of Development Finance Journal, Chartered Institute of Development Finance, vol. 10(2), pages 1-18.
    18. Ooi, Elizabeth, 2023. "Culture and confidence in financial knowledge testing," Pacific-Basin Finance Journal, Elsevier, vol. 77(C).
    19. Simon Zaby, 2019. "Science Mapping of the Global Knowledge Base on Microfinance: Influential Authors and Documents, 1989–2019," Sustainability, MDPI, vol. 11(14), pages 1-21, July.
    20. Niels Hermes & Marek Hudon, 2018. "Determinants Of The Performance Of Microfinance Institutions: A Systematic Review," Journal of Economic Surveys, Wiley Blackwell, vol. 32(5), pages 1483-1513, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:14:y:2022:i:5:p:3130-:d:766030. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.