The Microcredit Purpose Gap

Details

Supervisors

Parienté, William

Faculty

Faculté des sciences économiques, sociales, politiques et de communication

Degree label

Master [60] en sciences économiques, orientation générale

Abstract

The purpose of this thesis is to measure the definition and purpose gap of today’s microcredit compared to the microcredit launched by Dr. Muhammad Yunus 45 years ago. The different components of the definition are analyzed through study of the relevant literature and analysis of the MIX market data of The World Bank after having applied a thorough replicable data cleaning exercise. The seven different components that will be discussed in this thesis are the following: average loan balance per borrower, collateral, male vs female, rural vs urban, enterprise finance vs household financing, poor people’s access to microcredit and poor people empowerment. Although some of the original components are still applied today in some cases, we observe that since its conception different types of microcredit developed and spread over the world. Results about microcredit are often mixed: in some cases it can be beneficial, while in other cases microcredit can have harmful effects.