Naslov
Agent-based mapping of credit risk for sustainable microfinance

Autori
Lee, Joung-Hun ; Jusup, Marko ; Podobnik, Boris ; Yoh Iwasa

Izvornik
PLoS One (1932-6203) 10 (2015), 5; 1-16

Vrsta, podvrsta i kategorija rada
Radovi u časopisima, članak, znanstveni

Ključne riječi
microfinance ; networks ; phase transition

Sažetak
By drawing analogies with independent research areas, we propose an unorthodox frame- work for mapping microfinance credit risk—a major obstacle to the sustainability of lenders outreaching to the poor. Specifically, using the elements of network theory, we constructed an agent-based model that obeys the stylized rules of microfinance industry. We found that in a deteriorating economic environment confounded with adverse selection, a form of latent moral hazard may cause a regime shift from a high to a low loan payment probability. An after-the-fact recovery, when possible, required the economic environment to improve be- yond that which led to the shift in the first place. These findings suggest a small set of mea- surable quantities for mapping microfinance credit risk and, consequently, for balancing the requirements to reasonably price loans and to operate on a fully self-financed basis. We il- lustrate how the proposed mapping works using a 10-year monthly data set from one of the best-known microfinance representatives, Grameen Bank in Bangladesh. Finally, we dis- cuss an entirely new perspective for managing microfinance credit risk based on enticing spontaneous cooperation by building social capital.

Izvorni jezik
Engleski

Znanstvena područja
Fizika, Ekonomija

POVEZANOST RADA