Complementarity, Competition and Institutional Development: The Irish Loan Funds through Three Centuries
Ireland's loan funds were a long lived, self-sustaining, large-scale microcredit organization that made millions of loans, without collateral, to the poor. We examine the life-cycle of this institution and show how the loan funds responded to their economic environment in ways that benefitted Ireland but diminished the demand for the funds' services. During their first 100 years, a period of growth ending in the 1840s, they adapted constantly to reflect their changing environment, and were successful in obtaining improvements to their legal structure because they were complementary to the banking system and were seen as an effective method of relieving poverty. In contrast, in their second hundred years, they became ossified, perhaps because the commercial banks had become direct competitors. We see in their progress through 200 years an example of Douglass North's contention that institutions change incrementally and, when they are successful, often change the framework within which they operate.
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.:
- Hollis, Aidan & Sweetman, Arthur, 1998.
"Microcredit in Prefamine Ireland,"
Explorations in Economic History,
Elsevier, vol. 35(4), pages 347-380, October.
- North, Douglass C., 1984. "Government and the Cost of Exchange in History," The Journal of Economic History, Cambridge University Press, vol. 44(02), pages 255-264, June.
- Yifu Lin, Justin & Nugent, Jeffrey B., 1995. "Institutions and economic development," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 38, pages 2301-2370 Elsevier.
- Guinnane, T. & Banerjee, A. & Besley, T., 1993.
"Thy Neighbor's Keeper: the Design of a Credit Cooperative with Theory and a Test,"
705, Yale - Economic Growth Center.
- Abhijit V. Banerjee & Timothy Besley & Timothy W. Guinnane, 1994. "Thy Neighbor's Keeper: The Design of a Credit Cooperative with Theory and a Test," The Quarterly Journal of Economics, Oxford University Press, vol. 109(2), pages 491-515.
When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpeh:9704003. 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: (EconWPA)
If references are entirely missing, you can add them using this form.