This paper examines the case for a monetary union in selected
A large amount of money is spent by developing countries in designing and implementing poverty alleviation and reduction programmes. Many of these programmes have well defined objectives and sub-objectives – but the achievements are quite often uncertain. Most of the studies conducted to investigate the effectiveness of these programmes emphasize structural bottlenecks, asymmetric information, and rent seeking behaviour as hurdles preventing these programmes from reaching comprehensive benefits to their target households. This paper moves the investigation one step further and probes whether effective governance or its absence has any effect on the effectiveness of the poverty reduction programmes. The paper thus provides an analytical characterization of beneficiary households from both troubled and non-troubled Indian states and studies factors that were important in the beneficiaries realizing income benefits from the SITRA programme of the government of
The aim of this paper is to study the growth and corporate governance implications of market concentration in the GCC banking sector. It will begin by defining corporate governance, its significance in the context of banks, and how it can be improved by more competition or less concentration in the banking market. It will then discuss the importance of corporate governance to “better functioning and well-behaved” financial systems, and how both can favorably affect growth. A discussion of the GCC economies and banking system will follow, with an emphasis on market concentration in the banking system. To document empirically the effect of banking market concentration on growth, we estimate a growth model to capture this effect, and find that the effect is positive but conditioned by the level of financial development. The paper conclude by stating that policies aimed at opening the GCC banking market, and creating less concentration in the process, will have a positive effect on growth when the financial system is relatively more developed.
To mobilize savings and credit with earmarked priority to implement development strategies, financial depression and policy-driven financial institutions dominated the rural financial system in
The relationship between stock prices and exchange rate in
|Quantitative analysis indicates that variation in use of regulated and unregulated financial services in a low-income area of Mexico City can only partially be attributed to differences in socio-economic variables including gender, employment, education and housing status. Qualitative evidence suggests cognitive resources (including financial knowledge, attitudes and values) and socialised experiential learning are also important to financial inclusion and its relationship to vulnerability. Better understanding of these links requires more research into actual and potential users’ diverse and malleable mental models|
Efforts to discern ethical behaviour can lead to quite different results. Gandhi uses the most wretched person as the guide, Gauss stresses central tendencies, and Hayek suggests that specialisation is essential for a productive society. Use of finance has always been a lightening rod for ethical debate.
This paper seeks to determine nominal interest rates in five small developing countries - The Bahamas,
In this paper, the impact of interest rate reforms on financial deepening and savings in
Microfinance is often seen as an effective tool to reach the poor, yet there is a paucity of studies on the poverty level of microfinance clients, differentiated by type of microfinance institution. This paper seeks to make a contribution in closing that knowledge gap, and focuses on
L’objectif de cette recherche est de développer un modèle de crédit scoring en utilisant un échantillon de 496 emprunteurs individuels des IMF Tunisiennes. Les résultats ont montré que le genre, le rationnement du crédit, la possession d’une maison, d’autres sources de richesse, un revenu permanent, et finalement l’âge de l’association sont négativement corrélés avec la probabilité de défaut. Cependant, il s’est avéré que l’état civil, la possession d’un garant, la présence d’autres institutions dans la même zone géographique, contracter un prêt afin de mettre en œuvre un nouveau projet, sont positivement corrélés avec la probabilité de défaut. La prise en compte des cas rejetés dans un second modèle (modèle corrigé), a montré une certaine cohérence entre les prédictions du modèle et les décisions de rejet de l’institution et a permit également d’échapper aux jugements subjectifs des agents de crédit.
This paper investigates the dynamic interactions between four macroeconomic variables and stock prices in
The theory of financial liberalisation advocates the freeing up of financial markets so as to ensure a more efficient allocation of investment and a consequent improvement in economic growth.
Applying a non-parametric Data Envelopment Analysis (DEA) method, this paper attempts to investigate the efficiency of Malaysian banks during the post-merger period. We further analyzed the impact of risk and problem loans on Malaysian bank efficiency, when compared to the results attained from the basic DEA model. We found that the merger has largely benefited small and medium sized banks while on the other hand, large banks suffer from scale inefficiency and have been consistently operating at declining returns to scale (DRS). We found that the inclusion of loan loss provisions has resulted in an increase in the estimated mean efficiency levels for all banks under study. Our results also suggest that the mean pure technical efficiency estimates are much more sensitive than the mean scale efficiency estimates to the exclusion of risk factors.
This paper empirically examines the dynamic relationship between two short-term interest rates namely, repo rate (official) and call money rate (unofficial) during the full-fledged working of the liquidity adjustment facility in
This study attempts to provide empirical evidence on the importance of bank loan in channelling monetary policy effects to the real economy. Based on the Malaysian data, the study focuses on a sample period spanning from January 1989 to December 2006. It explores the causal relationships between bank loan and monetary policy variable using two major tests; first, the auto-regressive distributed lag (ARDL) model which is used to examine the long-run relationship among the variables and second, the vector error-correction model (VECM) which is adopted to explore the short- and long-run dynamics between the variables. To further enrich the discussion, the study includes bank deposit so as to compare the importance of bank asset (loan) and liability (deposit) in the monetary transmission process. The results of the study show that both bank loans and deposits play a crucial role in the monetary transmission process in the Malaysian case. In particular, bank loan is shown to provide an important nexus from monetary policy to output in the short run, while bank deposit is an important channel of monetary policy in the long run. The relevance of bank loans and deposits in the monetary transmission process implies the importance of ensuring the stability of the banking system as a pre-requisite to effective monetary policy implementation and economic stability in the country.
|The Decree 46 of 1992 created the National Board for Community Banks which was granted the power to license community banks. Community banks were created to: (1) promote rural development through provision of banking and financial services, (2) enhance rural productive activities, and (3) improve economic status of small-scale producers in rural and urban areas. According to Marx (2004), Nigeria has a dynamic informal financial sector. A key to growth strategy is to assist the development of this informal sector. The recent government policy to rid the economy of community banks defeats the original purpose underlying the creation of community banks. In view of the important role of community banks in Nigeria, the authors propose that community banks should continue to be rural financial institutions with specialized methods to serve broad segments of the rural population. The National Board for Community Banks should be vested with power to license, monitor and regulate community banks, and the regulatory power of the Central Bank of Nigeria over community banks should not go beyond that necessary for the performance of its monetary policy function. Furthermore, a partnership should be formed between the National Board for Community Banks, National Association of Community Banks and the Nigeria Agricultural, Cooperative and Rural Development Bank for the purpose of funding rural ventures through loan syndication. The Bankers’ Committee initiative for small and medium enterprises funding should be channeled through the Nigeria Agricultural, Cooperative and Rural Development Bank.|
This paper contends that international Non-Governmental Organisations (NGOs) have played a substantial role in developing financial services for the poor (or microfinance). Their influence has been greatest in:
• Pursuing a broader common vision and mission, particularly towards the poorest;
• Offering clients a larger range of products and services;
• Better engaging with industry regulators;
• Advocating for microfinance generally and conducting research.
Furthermore, even in cases where the role of these NGO Networks is no greater than other microfinance network support organizations, it appears the former are more willing to subsidise the costs of these benefits, such as with respect to innovation and creativity.
One of the main obstacles for the expansion of microcredit availability is the high transaction costs of credit operations for both lenders and borrowers. In order to decrease transaction costs, institutions adopt the solidarity groups lending system in order to transfer transaction costs to the group, making it assume a large amount of the risk.
This paper identifies factors that explain why microfinance institutions are reaching more clients in some countries than in others. To that end, the paper applies a cross-country analysis on a unique dataset covering 115 countries. Results indicate that the microfinance sector is more present in the richer countries of the developing world. It also reaches more clients in countries that receive more international support. Population density plays a positive role, which could in part explain why the sector is still underdeveloped in rural areas. The level of industrialisation and inflation do not seem to influence microfinance outreach, while regional dummies do.