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Microfinancing in Developing Countries: An Assessment Taking Particular Account of the Views of Becker and Posner

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  • Tisdell, Clem
  • Ahmad, Shabbir

Abstract

This paper assesses the views expressed by Gary Becker and Richard Posner about the economic value of relying on microfinancing for economic development as well as their opinions about its desirability as a means of alleviating poverty. It also raises some issues overlooked by Becker and Posner. Where relevant, the discussion is related to results obtained from a case study of microfinancing in the Sindh District of Pakistan. Subjects covered include the economic efficiency of the supply of microfinance, the optimality of microfinancing versus philanthropy, whether high interest rates and short-term loans for microfinance are justified, preference for females rather than males in microfinancing, social networking and the efficient provision and allocation of microfinance, and the prospects for escaping from poverty as a result of microfinancing.

Suggested Citation

  • Tisdell, Clem & Ahmad, Shabbir, 2017. "Microfinancing in Developing Countries: An Assessment Taking Particular Account of the Views of Becker and Posner," Social Economics, Policy and Development Working Papers 263400, University of Queensland, School of Economics.
    • Handle: RePEc:ags:uqsese:263400
    DOI: 10.22004/ag.econ.263400
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    References listed on IDEAS

    as
    1. Ghazal Zulfiqar, 2017. "Does Microfinance Enhance Gender Equity in Access to Finance? Evidence from Pakistan," Feminist Economics, Taylor & Francis Journals, vol. 23(1), pages 160-185, January.
    2. Richard L. Meyer, 2002. "The demand for flexible microfinance products: lessons from Bangladesh," Journal of International Development, John Wiley & Sons, Ltd., vol. 14(3), pages 351-368.
    3. Tisdell, Clem & Ahmad, Shabbir & Nadia, Agha & Steen, John & Verreynne, Martie-Louise, 2017. "Loans, Wealth Creation and the Socioeconomic Situation of Women in the Taluka Area of the Khairpur District, Sindh, Pakistan: A Study Based on Interviews with Female Focal Groups," Social Economics, Policy and Development Working Papers 261491, University of Queensland, School of Economics.
    4. Naudé, Wim, 2011. "Entrepreneurship is Not a Binding Constraint on Growth and Development in the Poorest Countries," World Development, Elsevier, vol. 39(1), pages 33-44, January.
    5. Abhijit Banerjee & Dean Karlan & Jonathan Zinman, 2015. "Six Randomized Evaluations of Microcredit: Introduction and Further Steps," American Economic Journal: Applied Economics, American Economic Association, vol. 7(1), pages 1-21, January.
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