The effect of social capital on group loan repayment: Evidence from field experiments

Economic Journal

Volumn 117, Issue 517, 2007, Pages

  Cassar, Alessandra ^a   Crowley, Luke ^a   Wydick, Bruce ^a  

^a UNIVERSITY OF SAN FRANCISCO   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

FINANCIAL SYSTEM; LENDING BEHAVIOR; MICROFINANCE; SOCIAL CAPITAL;

AFRICA; ARMENIA; ASIA; EURASIA; SOUTH AFRICA; SOUTHERN AFRICA; SUB-SAHARAN AFRICA; WEST ASIA;

EID: 34249331697     PISSN: 00130133     EISSN: 14680297     Source Type: Journal    
DOI: 10.1111/j.1468-0297.2007.02016.x     Document Type: Article

References (28)

1. Abbink, K., Irlenbusch, B. and Renner, E. (2006). 'Group size and social ties in microfinance institutions', Economic Inquiry, vol. 44 (4), pp. 614-28.
2. Ahlin, C. and Townsend, R. (2007). 'Using repayment data to test across models of joint liability lending', Economic Journal, vol. 117, pp. F11-F51.
3. Armendáriz de Aghion, B. (1999). 'On the design of a credit agreement with peer monitoring', Journal of Development Economics, vol. 60 (1), pp. 79-104.
4. Armendáriz de Aghion, B. and Gollier, C. (2000). 'Peer group formation in an adverse selection model', Economic Journal, vol. 110, pp. 632-43.
5. Armendáriz de Aghion, B. and Morduch, J. (2005). The Economics of Microfinance, Cambridge MA: MIT Press.
6. Banerjee, A., Besley, T. and Guinnane, T. (1994). 'Thy neighbor's keeper: Design of a credit cooperative with theory and a test', Quarterly Journal of Economics, vol. 102 (9), pp. 491-515.
7. Berg, J., Dickhaut, J. and McCabe, K. (1995). 'Trust, reciprocity, and social history', Games and Economic Behavior, vol. 10 (1), pp. 122-42.
8. Besley, T. and Coate, S. (1995). 'Group lending, repayment incentives and social collateral', Journal of Development Economics, vol. 46 (1), pp. 1-18.
9. Bohnet, I. and Frey, B. (1999). 'Social distance and other-regarding behavior in dictator games: Comment', American Economic Review, vol. 89 (1), pp. 335-9.
10. Coleman, J. (1988). 'Social capital in the creation of human capital', American Journal of Sociology, vol. 94, pp. 95-120.
11. Cull, R., Demirgüc-Kunt, A. and Morduch, J. (2007). 'Financial performance and outreach: A global analysis of leading micro banks', Economic Journal, vol. 117, pp. F107-F133.
12. Fafchamps, M. (1992). 'Solitary networks in preindustrial societies: rational peasants with a moral economy', Economic Development and Cultural Change, vol. 40, pp. 147-74.
13. Ghatak, M. (1999). 'Group lending, local information and peer selection', Journal of Development Economics, vol. 60 (1), pp. 27-50.
14. Giné, X., Jakiela, P., Karlan, D. and Morduch, J. (2005). 'Microfinance games', Working Paper, Yale University and New York University.
15. Glaeser, E., Laibson, D., Scheinkman, J. and Soutter, C (2000). 'Measuring trust', Quarterly Journal of Economics, vol. 115, pp. 811-46.
16. Gómez, R. and Santor, E. (2003). 'Do peer group members outperform individual borrowers? A test of peer group lending using Canadian microcredit data', Bank of Canada, Working Paper (October).
17. Harrison, G. and List, J. (2004). 'Field experiments', Journal of Economic Literature, vol. 62, pp. 1009-55.
18. Karlan, D. (2005). 'Using experimental economics to measure social capital and predict financial decisions', American Economic Review, vol. 95, pp. 1688-99.
19. Karlan, D. (2007). 'Social connections and group banking', Economic Journal, vol. 117, pp. F52-F84.
20. Putnam, R. (1993). Making Democracy Work: Civic Traditions in Modern Italy, Princeton, NJ: Princeton University Press.
21. Scott, J. (1976). The Moral Economy of the Peasant, New Haven: Yale University Press.
22. Stiglitz, J. (1990). 'Peer monitoring and credit markets', The World Bank Economic Review, vol. 4 (3), pp. 351-66.
23. Udry, C. (1994). 'Risk and insurance in a rural credit market: An empirical investigation in northern Nigeria', Review of Economic Studies, vol. 61 (1), pp. 495-526.
24. Van Tassel, E. (1999). 'Group lending under asymmetric information', Journal of Development Economics, vol. 60 (1), pp. 3-25.
25. Wenner, M. (1995). 'Group credit: A means to improve information transfer and loan repayment performance', Journal of Development Studies, vol. 32 (1), pp. 263-81.
26. Wydick, B. (1999). 'Can social cohesion be harnessed to mitigate market failures? Evidence from group lending in Guatemala', Economic Journal, vol. 109, pp. 463-75.
27. Wydick, B. (2001). 'Group lending under dynamic incentives as a borrower discipline device', Review of Development Economics, vol. 5 (3), pp. 406-20.
28. Zeller, M. (1998). 'Determinants of repayment performance in credit groups: The role of program design, intragroup risk pooling, and social cohesion', Economic Development and Cultural Change, vol. 46 (3), pp. 599-620.