Effectively Extending Computational Training Using Informal Means at Larger Institutions

Linkages between formal and informal financial institutions in extending financial services to the poor

Introduction One of the most important innovations in development finance in recent years has been the emergence of microfinance. Millions of very poor people receive and repay small loans, even though they possess few assets or skills. At least two decades of experimenting lead donors and practitioners in developing countries to identify and duplicate best practices – just think about the famo...

Informal Institutions and Property Rights

In recent years, the call for strong and clear property rights has grown in law and development circles. In the landmark book The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else, de Soto put forth the claim that “strong and clear” property rights, formalized rather than informal, are necessary for economic efficiency and for the protection of the poor, who occu...

Matching in Informal Financial Institutions.

This paper analyzes an informal financial institution that brings heterogeneous agents together in groups. We analyze decentralized matching into these groups, and the equilibrium composition of participants that consequently arises. We find that participants sort remarkably well across the competing groups, and that they re-sort immediately following an unexpected exogenous regulatory change. ...

Formal and Informal Market Institutions : Embeddedness Revisited

Market exchange involves many cognitive and non-cognitive processes — e.g., search, inference, prediction, negotiation. Much attention has been devoted to these issues both in theory and in experimental economics. I focus on the enforcement of market transactions against opportunistic behavior. I first discuss the different mechanisms that can deter opportunistic breach of contract. Some of the...

Informal Institutions a “Weaknesses” of Hu Behavior