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2013-06-10 - Colloque/Présentation - communication orale - Anglais - 10 page(s)

Labie Marc , Périlleux Anaïs, Brihaye Thomas , De Pril Julie , "Positive incentives in microfinance: a game theory approach" in Third European Research Conference on Microfinance, University of Agder, Norway, 2013

  • Codes CREF : Economie des PVD (DI4375)
  • Unités de recherche UMONS : Economie et gestion de l'entreprise (W742)
  • Instituts UMONS : Institut de Recherche en Développement Humain et des Organisations (HumanOrg)
  • Centres UMONS : Microfinance (CERMI)

Abstract(s) :

(Anglais) In many developing countries, microfinance has grown tremendously over the last twenty years. It did so by providing innovative answers to traditional asymmetries of information that characterize financial markets while establishing at the same time a huge variety of institutions. All together, this evolved into the establishment of an industry which is simultaneously part of development policies but also more and more of mainstream financial markets. However, looking at financial intermediation at world level, there is still a large unmet demand and innovations remain needed in order to face the mismatch existing between financial supply and demand. In most of the methodologies used so far in microfinance, negative incentives are predominant. This paper tries to understand if microfinance industry could benefit from focusing more on positive incentives. More precisely, it compares two different incentives - a positive one as a bonus and a negative one as a sanction - to encourage loan repayments. Thanks to game theory, it is shown that clients are more likely to repay their loans (on time) in the positive incentive scheme than in the negative one.