Environmental Shocks and Sustainability in Microfinance
| dc.creator | Goodspeed, Tyler Beck | |
| dc.date | 2019-12-04T22:50:39Z | |
| dc.date | 2019-12-04T22:50:39Z | |
| dc.date | 2018-06 | |
| dc.date.accessioned | 2026-07-01T00:43:38Z | |
| dc.description | I study the effects of a major environmental shock on microfinance lending by analyzing the Irish Loan Funds during the Great Famine of Ireland. I find that funds in districts worse affected by blight experienced higher failure rates and greater credit retrenchment and flight-to-quality than funds in less affected districts. Though greater leverage was generally associated with a higher predicted probability of institutional survival, the reverse was true where blight infection was more severe, and though more profitable funds were generally no more likely to survive, higher pre-famine margins were positive predictors of institutional survival where blight infection was worse. Results further indicate that the primary mechanisms by which pre-famine balance sheet metrics influenced survival probabilities were differential balance sheet contraction and flight-to-quality during the famine. The results of this study, therefore, suggest that optimal lending models in ordinary circumstances may render microfinance institutions (MFIs) more vulnerable to tail-probability aggregate shocks, with higher leverage, lower paid staff, lower economic rents, and more extensive liabilities limiting the scope for credit retrenchment and flight-to-quality. Results further indicate that one cost of MFI resilience to adverse environmental change is substantially reduced outreach to borrowers of lower credit quality. | |
| dc.format | application/pdf | |
| dc.identifier | World Bank Economic Review | |
| dc.identifier | 1564-698X | |
| dc.identifier | https://hdl.handle.net/10986/32785 | |
| dc.identifier | 10.1596/32785 | |
| dc.identifier.uri | http://hdl.handle.net/123456789/409969 | |
| dc.publisher | Published by Oxford University Press on behalf of the World Bank | |
| dc.relation | World Bank Economic Review | |
| dc.rights | CC BY-NC-ND 3.0 IGO | |
| dc.rights | http://creativecommons.org/licenses/by-nc-nd/3.0/igo | |
| dc.rights | World Bank | |
| dc.subject | ENVIRONMENTAL SHOCK | |
| dc.subject | NATURAL DISASTER | |
| dc.subject | MICROFINANCE | |
| dc.subject | GREAT FAMINE | |
| dc.subject | CREDIT RETRENCHMENT | |
| dc.title | Environmental Shocks and Sustainability in Microfinance | |
| dc.title | Evidence from the Great Famine of Ireland | |
| dc.type | Journal Article | |
| dc.type | Article de journal | |
| dc.type | Artículo de revista |