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Rosca Participation in Benin: a Commitment Issue

Author

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  • Olivier Dagnelie
  • Philippe LeMay-Boucher

Abstract

In the light of first-hand data from a Beninese urban household survey in Cotonou, we investigate several motives aiming to explain participation in Rotating Savings and Credit Associations. We provide anecdotal pieces of evidence, descriptive statistics, FIML regressions and matching estimates which tend to indicate that most individuals use their participation in a rosca as a device to commit themselves to save money and to deal with self-control problems.

Suggested Citation

  • Olivier Dagnelie & Philippe LeMay-Boucher, 2008. "Rosca Participation in Benin: a Commitment Issue," Working Papers 339, Barcelona Graduate School of Economics.
  • Handle: RePEc:bge:wpaper:339
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Alistair Munro, 2014. "Hide and Seek: A Theory of Efficient Income Hiding within the Household," GRIPS Discussion Papers 14-17, National Graduate Institute for Policy Studies.
    2. repec:hur:ijarbs:v:7:y:2017:i:8:p:388-397 is not listed on IDEAS
    3. Karna Basu, 2011. "Hyperbolic Discounting and the Sustainability of Rotational Savings Arrangements," American Economic Journal: Microeconomics, American Economic Association, pages 143-171.
    4. Luc Dossa & Barbara Rischkowsky & Regina Birner & Clemens Wollny, 2008. "Socio-economic determinants of keeping goats and sheep by rural people in southern Benin," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 25(4), pages 581-592, December.
    5. Jacopo Bonan & Philippe LeMay-Boucher & Douglas Scott, 2016. "Can Hypothetical Time Discounting Rates Predict Actual Behaviour: Evidence from a Randomized Experiment," Working Papers 2016.74, Fondazione Eni Enrico Mattei.
    6. Basu, Karna, 2014. "Commitment savings in informal banking markets," Journal of Development Economics, Elsevier, pages 97-111.
    7. Abbi Kedir & Richard Disney & Indraneel Dasgupta, "undated". "Why Use Roscas When You Can Use Banks? Theory And Evidence From Ethiopia," Discussion Papers 11/05, University of Nottingham, CREDIT.
    8. A. Lasagni & E. Lollo, 2011. "Participation in Rotating Savings and Credit Associations in Indonesia: New Empirical Evidence on Social Capital," Economics Department Working Papers 2011-EP05, Department of Economics, Parma University (Italy).
    9. Adelman, Sarah, 2013. "Keep your friends close: The effect of local social networks on child human capital outcomes," Journal of Development Economics, Elsevier, pages 284-298.

    More about this item

    Keywords

    ROSCA; self-control; commitment device; Benin;

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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