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A socio-economic study of the borrowing process: The case of microentrepreneurs in Jordan


  • Dutta, Dilip
  • Magableh, Ihab


This paper investigates the socio-economic determinants of four stages of borrowing process of the Jordanian microfinance market. The equations and functions corresponding to the stages of the borrowing process are estimated using a sample of 474 microentrepreneurs. The main results are as follow: variables that reflect the repayment ability are the main determinants of credit rationing in the microfinance market; religious beliefs, social responsibilities, availability of local microfinance providers, application costs, level of knowledge about microfinance providers significantly affect the borrowing process of microentrepreneurs. Credit rationing is found to be a problem for some applicants, but not for the majority.

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  • Dutta, Dilip & Magableh, Ihab, 2004. "A socio-economic study of the borrowing process: The case of microentrepreneurs in Jordan," Working Papers 7, University of Sydney, School of Economics.
  • Handle: RePEc:syd:wpaper:2123/7646

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    References listed on IDEAS

    1. Tang, Shui-Yan, 1995. "Informal credit markets and economic development in Taiwan," World Development, Elsevier, vol. 23(5), pages 845-855, May.
    2. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    3. Tullio Jappelli, 1990. "Who is Credit Constrained in the U. S. Economy?," The Quarterly Journal of Economics, Oxford University Press, vol. 105(1), pages 219-234.
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    Cited by:

    1. Kumar, D. Suresh, 2009. "Participation in Self-Help Group Activities and its Impacts: Evidence from South India," MPRA Paper 19943, University Library of Munich, Germany, revised 31 Aug 2009.
    2. Kajenthiran. K & Achchuthan. S & Ajanthan. A, 2017. "A Quest for Seeking Microcredit among Youth: Evidence from an Emerging Nation in South Asian Region," Advances in Management and Applied Economics, SCIENPRESS Ltd, vol. 7(2), pages 1-8.
    3. Li, Rui & Li, Qinghai & Huang, Shaoan & Zhu, Xi, 2013. "The credit rationing of Chinese rural households and its welfare loss: An investigation based on panel data," China Economic Review, Elsevier, vol. 26(C), pages 17-27.


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