On Ethical Violations in Microfinance Backed Small Businesses: Family and Household Welfare
TL;DR: In this article, the authors find that high dependency ratios in the family are correlated with such ethical violations, and also find that ethical violations have a significant economic cost, consistent with prior scholarship in family-business domain.
Abstract: The microfinance business model focuses largely on lending to the woman in the household, rather than the man. The belief is that women are more trustworthy borrowers than men, and that lending to women may have increased social impact. Yet in several cases, women do not have control over the loan backed business despite being the borrower of record. Such takeover of the business by the man constitutes an ethical violation. We find that high dependency ratios in the family are correlates of such ethical violations. Further, we also find that ethical violations have a significant economic cost, consistent with prior scholarship in the family-business domain. While access to microfinance increases household welfare, this beneficial impact reduces by over 50% in the presence of an ethical violation. Our results suggest that microfinance lenders need to move beyond the traditional role of just being a lender to providing advice on issues like family planning, and money management, and enforcement, thus moving closer to the solidarity economy paradigm of integrating savings and credit into broader canvases of social relationships and social structures.
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01 Jan 1996
TL;DR: In this paper, anthropological research on the micro-credit program of the Grameen Bank shows that bank workers are expected to increase disbursement of loans among their members and press for high recovery rates to earn profit necessary for economic viability of the institution.
Abstract: Abstract There is a growing acknowledgement that micro-credit programs have potential for equitable and sustainable development. However, my anthropological research on the micro-credit program of the Grameen Bank shows that bank workers are expected to increase disbursement of loans among their members and press for high recovery rates to earn profit necessary for economic viability of the institution. To ensure timely repayment in the loan centers bank workers and borrowing peers inflict an intense pressure on women clients. In the study community many borrowers maintain their regular payment schedules through a process of loan recycling that considerably increases the debt-liability on the individual households, increases tension and frustration among household members, produces new forms of dominance over women and increases violence in society.
740 citations
27 May 2013
TL;DR: In this article, the authors investigated whether organizational profitability and environmental factors (industry regulation) affect board task performance and found that past firm performance is negatively associated with board monitoring and advice tasks.
Abstract: Boards of directors are key governancemechanisms in organizations and fulfill twomain tasks:monitoringmanagers
and firm performance, and providing advice and access to resources. In spite of a wealth of researchmuch
remains unknown about how boards attend to the two tasks. This study investigates whether organizational
(firm profitability) and environmental factors (industry regulation) affect board task performance. The data
combine CEOs' responses to a questionnaire, and archival data from a sample of large Italian firms. Findings
show that past firm performance is negatively associatedwith board monitoring and advice tasks; greater industry regulation enhances perceived board task performance; board monitoring and advice tasks tend to reinforce each other, despite their theoretical and practical distinction.
82 citations
Posted Content•
TL;DR: In this paper, a large-scale systematic analysis of the trade-off between financial performance and outreach of micro-finance institutions is presented, where three empirical contributions provide new insights with respect to why and how joint liability group lending works.
Abstract: Microfinance has received a lot of attention recently, both from policy makers as well as in academic circles. Two of the main topics that have been hotly debated are explaining joint liability group lending and its implications for reducing information asymmetries, and the trade-off between the financial sustainability and outreach of microfinance programmes. This Feature contains three novel empirical contributions providing new insights with respect to why and how joint liability group lending works. It also contains the first large-scale systematic analysis of the trade-off between financial performance and outreach of microfinance institutions.
51 citations
01 Jan 2010
TL;DR: In this paper, a critical review of the literature and case studies from the Philippines, the author suggests a value-based Vincentian approach to integrate micro-finance into community empowerment and argues that the achievement of economic self-reliance through microfinance is contingent upon the development of capacity building, social capital, and empowerment at the individual, collective, and systemic levels.
Abstract: The purpose of this article is to present and discuss the values and limits of microfinance within the context of poverty reduction, international development, and community empowerment. The main thesis is that microfinance requires a more complex strategy than simply the provision of credits. The development of financial capital depends on the increase in human capacity and social capital. Microfinance is revisited under the ethical lenses of global responsibility for alleviating poverty and developing community sustainability. Through a critical review of the literature and case studies from the Philippines, the author suggests a value-based Vincentian approach to integrate microfinance into community empowerment. In connection with the main thesis the author argues that the achievement of economic self-reliance through microfinance is contingent upon the development of capacity building, social capital, and empowerment at the individual, collective, and systemic levels.
35 citations
Posted Content•
TL;DR: In this article, the concept of motivation as an important resource for entrepreneurship is developed using theories of Anthony Giddens and Talcott Parsons and examining the biographical narratives of self-employed migrants.
Abstract: After many European countries introduced policies supporting self-employment in the 1980s, many migrants were not as successful as their native counterparts. The resources underlying policies for business starters are analyzed and existing assumptions about resources needed for entrepreneurial activity are challenged. The conception of resources underlying policy implementation has been based on a self-employment model of mainly native male entrepreneurs. The theoretical distinction between class and ethnic resources needs to be broadened by a more dynamic approach to biographical analysis. The concept of motivation as an important resource for entrepreneurship is developed using theories of Anthony Giddens and Talcott Parsons and examining the biographical narratives of self-employed migrants. The empirical basis of this study consists of the analysis of 40 biographical narratives of self-employed migrant women and men from the Rhein/Main area in Germany. The interviewees responded that the decision to become self-employed was grounded in strong motivation, either a result of biographical processes or a way of coping with "biographical conflicts and coercion." Other findings suggest that the absence of class resources is a basis for the emergence of strong motivation toward entrepreneurship, while cultural and sub-cultural experience/capital became the resource for developing business plans in a chosen field. Existing motivation potentials can be supported through an entrepreneur-friendly cultural environment, which neither idealizes nor dismisses migrant men and women. The issue of motivational resources becomes important in practices of labor administrations in Europe, aiming at extending public support to non-privileged business starters without class resources. (CBS)
32 citations
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TL;DR: In this article, the authors draw on recent progress in the theory of property rights, agency, and finance to develop a theory of ownership structure for the firm, which casts new light on and has implications for a variety of issues in the professional and popular literature.
49,666 citations
Book•
01 Jan 1991TL;DR: In this article, the effects of predictor scaling on the coefficients of regression equations are investigated. But, they focus mainly on the effect of predictors scaling on coefficients of regressions.
Abstract: Introduction Interactions between Continuous Predictors in Multiple Regression The Effects of Predictor Scaling on Coefficients of Regression Equations Testing and Probing Three-Way Interactions Structuring Regression Equations to Reflect Higher Order Relationships Model and Effect Testing with Higher Order Terms Interactions between Categorical and Continuous Variables Reliability and Statistical Power Conclusion Some Contrasts Between ANOVA and MR in Practice
27,897 citations
Book•
01 Jan 1978
TL;DR: The External Control of Organizations as discussed by the authors explores how external constraints affect organizations and provides insights for designing and managing organizations to mitigate these constraints, and it is the fact of the organization's dependence on the environment that makes the external constraint and control of organizational behavior both possible and almost inevitable.
Abstract: Among the most widely cited books in the social sciences, The External Control of Organizations has long been required reading for any student of organization studies. The book, reissued on its 25th anniversary as part of the Stanford Business Classics series, includes a new preface written by Jeffrey Pfeffer, which examines the legacy of this influential work in current research and its relationship to other theories.The External Control of Organizations explores how external constraints affect organizations and provides insights for designing and managing organizations to mitigate these constraints. All organizations are dependent on the environment for their survival. As the authors contend, "it is the fact of the organization's dependence on the environment that makes the external constraint and control of organizational behavior both possible and almost inevitable." Organizations can either try to change their environments through political means or form interorganizational relationships to control or absorb uncertainty. This seminal book established the resource dependence approach that has informed so many other important organization theories.
13,195 citations
12,500 citations
TL;DR: In this paper, a method of estimating the parameters of a set of regression equations is reported which involves application of Aitken's generalized least-squares to the whole system of equations.
Abstract: In this paper a method of estimating the parameters of a set of regression equations is reported which involves application of Aitken's generalized least-squares [1] to the whole system of equations. Under conditions generally encountered in practice, it is found that the regression coefficient estimators so obtained are at least asymptotically more efficient than those obtained by an equation-by-equation application of least squares. This gain in efficiency can be quite large if “independent” variables in different equations are not highly correlated and if disturbance terms in different equations are highly correlated. Further, tests of the hypothesis that all regression equation coefficient vectors are equal, based on “micro” and “macro” data, are described. If this hypothesis is accepted, there will be no aggregation bias. Finally, the estimation procedure and the “micro-test” for aggregation bias are applied in the analysis of annual investment data, 1935–1954, for two firms.
7,637 citations