Abstract
We study whether microfinance institutions (MFIs) have improved the availability of credit to microenterprises in Eastern Europe and Central Asia (ECA) in the first half of the past decade. Our approach is different from that of a typical microfinance impact study, which focuses on evaluating social or economic impact of a single MFI (or product). Our motivation is closer to the financial sector development microfinance ‘schism’ that requires MFIs to lend to poor entrepreneurs who already have the skills and the markets but lack credit (Conning, 1999). Countries in the ECA region are appropriate for such an approach because, during the study period, they had an educated but impoverished population and limited credit supply.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Beck, T. and Brown, M. (2011). ‘Use of Banking Services in Emerging Markets – Household-Level Evidence’. European Banking Center Discussion Paper No. 2011–024. Center Discussion Paper Series No. 2011–089.
Beck, T., Demirgüç-Kunt, A. and Singer, D. (2011). ‘Is Small Beautiful? Financial Structure, Size and Access to Finance’. World Bank Policy Research Working Paper No. 5806. Working Paper Series.
Benjamin, N. and Ledgerwood, J. (1999). ‘The Dominican Republic – ADEMI’. In Sustainable Banking with the Poor, p. 69, Washington DC: World Bank.
Budina, N., Garretsen, H. and De Jong, E. (2000). ‘Liquidity Constraints and Investment in Transition Economies: The Case of Bulgaria’. Economics of Transition 8 (2), 453–75.
Carreira, C. and Silva, F. (2010). ‘No Deep Pockets: Some Stylized Empirical Results on Firms’ Financial Constraints’. Journal of Economic Surveys 24 (4), 731–53.
Conning, J. (1999). ‘Outreach, Sustainability and Leverage in Monitored and Peer Monitored Lending’. Journal of Development Economics 60, 51–77.
Fazzari, S., Hubbard, G. and Petersen, B. (1988). ‘Finance Constraints and Corporate Investment’. Brookings Papers on Economic Activity 1, 141–95.
Hartarska, V. and Gonzalez-Vega, C. (2006). ‘What Affects New and Established Firms Expansion? Evidence from Small Firms in Russia’. Small Business Economics 27, 195–206.
Hartarska, V. and Nadolnyak, D. (2007). ‘Do Regulated Microfinance Institutions Achieve Better Sustainability and Outreach? Cross-Country Evidence’. Applied Economics 39 (10), 1207–22.
Hartarska, V. and Nadolnyak, D. (2008a). ‘An Impact Analysis of Microfinance in Bosnia’. World Development 26 (12), 2605–19.
Hartarska, V. and Nadolnyak, D. (2008b). ‘Does Rating Help Microfinance Institutions Raise Funds? Cross-Country Evidence’. International Review of Economics and Finance 17, 558–71.
Hubbard, G. (1998). ‘Capital Market Imperfections and Investment’. Journal of Economic Literature 36 (1), 192–225.
Jensen, M. C. and Meckling, W. H. (1976). ‘Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure’. Journal of Financial Economics 3, 305–60.
Lizal, L. and Svejnar, J. (2001). ‘Investment, Credit Rationing and the Soft Budget Constraint: Evidence from Czech Panel Data’. Review of Economics and Statistics 83 (1), 92–9.
Myers, S. C. and Majluf, N. S. (1984). ‘Corporate Financing and Investment Decisions When Firms Have Information That Investors Do Not Have’. Journal of Financial Economics 13 (2), 187–221.
Pytkowska, J. and Rataj, M. (2007). ‘2006 The State of Microfinance Industry in Eastern Europe and Central Asia’. Microfinance Centre for Central and Eastern Europe and New Independent States.
Stiglitz, J. E. and Weiss, A. (1981). ‘Credit Rationing in Markets with Imperfect Information’. American Economic Review 71 (3), 393–410.
Editor information
Editors and Affiliations
Copyright information
© 2013 Valentina Hartarska, Denis Nadolnyak and Thomas McAdams
About this chapter
Cite this chapter
Hartarska, V., Nadolnyak, D., McAdams, T. (2013). Microfinance and Microenterprises’ Financing Constraints in Eastern Europe and Central Asia. In: Gueyie, JP., Manos, R., Yaron, J. (eds) Microfinance in Developing Countries. Palgrave Macmillan, London. https://doi.org/10.1057/9781137301925_2
Download citation
DOI: https://doi.org/10.1057/9781137301925_2
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-34563-2
Online ISBN: 978-1-137-30192-5
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)