Advanced Search
MyIDEAS: Login to save this paper or follow this series

Making the poor pay for public goods via microfinance: Economic and political pitfalls in the case of water and sanitation

Contents:

Author Info

  • Mader, Philip
Registered author(s):

    Abstract

    This paper critically assesses microfinance's expansion into the provision of public goods. It focuses on the problem of public goods and collective action and refers to the specific example of water and sanitation. The microfinancing of water and sanitation is a private business model which requires households to recognise, internalise and capitalise the benefits from improved water and sanitation. This requirement is not assured. Water and sanitation, being closely linked to underlying common-pool resources, are public goods which depend on collective governance solutions. They also have shifting public/private characteristics and are merit goods which depend on networks to enable provision to take place. Two cases, from Vietnam and India, are presented and evaluated. Despite their dissimilar settings and institutional designs, evidence is found that both projects encountered similar and comparable problems at the collective level which individual microfinance loans could not address. The paper concludes that trying to make the poor pay for public goods runs into four pitfalls: politics, public capacity, values and equity. -- Das Papier untersucht die Auswirkungen von Mikrofinanzierung auf öffentliche Güter und kollektives Handeln am Beispiel der Errichtung von Wasser- und Sanitäranlagen in Ländern der Dritten Welt. Das zugrunde liegende private Geschäftsmodell geht davon aus, dass Haushalte mittels Mikrokredite die Vorteile verbesserter Wasser- und Sanitäreinrichtungen erkennen und sich auch finanziell zunutze machen können - diese Voraussetzung ist allerdings nicht gegeben. Zudem sind Wasser- und Sanitärversorgung meritorische Güter, für deren Bereitstellung Netzwerke erforderlich sind. Sie erfordern eine kollektive Verwaltung, weil sie sowohl öffentliche als auch private Merkmale aufweisen und mit Gemeinschaftsgütern eng verknüpft sind. Ausgangslage und institutionelle Rahmenbedingungen der beiden untersuchten Fallbeispiele in Vietnam und Indien sind unterschiedlich. Trotzdem geben die Ergebnisse der Studie Hinweise auf vergleichbare Probleme auf der kollektiven Ebene, die nicht über Mikrofinanzierung lösbar sind. Es zeigt sich, dass der Versuch, die Armen zur Finanzierung öffentlicher Güter zu bringen, an mehreren Hindernissen scheitert: an der lokalen Politik, einem unzureichend entwickelten öffentlichen Sektor, unterschiedlichen Wertvorstellungen und mangelnder Verteilungsgerechtigkeit.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://econstor.eu/bitstream/10419/50556/1/669700754.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by Max Planck Institute for the Study of Societies in its series MPIfG Discussion Paper with number 11/14.

    as in new window
    Length:
    Date of creation: 2011
    Date of revision:
    Handle: RePEc:zbw:mpifgd:1114

    Contact details of provider:
    Postal: Paulstr. 3, 50676 Köln
    Phone: + 49 (0) 221-2767-0
    Email:
    Web page: http://www.mpifg.de/
    More information through EDIRC

    Related research

    Keywords:

    This paper has been announced in the following NEP Reports:

    References

    References listed on IDEAS
    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.:
    as in new window
    1. Karlan, Dean S. & Zinman, Jonathan, 2009. "Expanding Microenterprise Credit Access: Using Randomized Supply Decisions to Estimate the Impacts in Manila," CEPR Discussion Papers 7396, C.E.P.R. Discussion Papers.
    2. Byström, Hans N.E., 2008. "The Microfinance Collateralized Debt Obligation: A Modern Robin Hood?," World Development, Elsevier, vol. 36(11), pages 2109-2126, November.
    3. Anand, P B, 2007. "Right to water and access to water," MPRA Paper 47437, University Library of Munich, Germany.
    4. P. B. Anand, 2007. "Right to water and access to water: an assessment," Journal of International Development, John Wiley & Sons, Ltd., vol. 19(4), pages 511-526.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:zbw:mpifgd:1114. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics).

    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 references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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