Social Connections and Group Banking
| dc.creator | Karlan, Dean S. | |
| dc.date | 2017-04-01T18:06:28Z | |
| dc.date.accessioned | 2026-07-09T04:01:34Z | |
| dc.description | Lending to the poor is expensive due to high screening, monitoring, and enforcement costs. Group lending advocates believe lenders overcome this by harnessing social connections. Using data from FINCA-Peru, I exploit a quasi-random group formation process to find evidence of peers successfully monitoring and enforcing joint-liability loans. Individuals with stronger social connections to their fellow group members (i.e., either living closer or being of a similar culture) have higher repayment and higher savings. Furthermore, I observe direct evidence that relationships deteriorate after default, and that through successful monitoring, individuals know who to punish and who not to punish after default. | |
| dc.identifier | doi:10.22004/ag.econ.28522 | |
| dc.identifier | https://ageconsearch.umn.edu/record/28522/files/dp050913.pdf | |
| dc.identifier | http://ageconsearch.umn.edu/record/28522 | |
| dc.identifier.uri | http://hdl.handle.net/123456789/543696 | |
| dc.language | eng | |
| dc.publisher | ||
| dc.source | http://ageconsearch.umn.edu/record/28522 | |
| dc.title | Social Connections and Group Banking | |
| dc.type | Text |