Membership has its privileges: the effect of social capital and neighbourhood characteristics on the earnings of microfinance borrowers

Gomez, Rafael and Santor, Eric (2001) Membership has its privileges: the effect of social capital and neighbourhood characteristics on the earnings of microfinance borrowers. Canadian Journal of Economics, 34 (4). 943 - 966. ISSN 0008-4085

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Abstract

In this paper we examine the determinants of self‐employment success for microcredit borrowers. Theories of social capital and neighbourhood effects are integrated in an attempt to account for earnings differentials among a unique sample of microfinance borrowers. We posit that social capital – social relations that facilitate individual action – is essential for microentrepreneurial success. Based on a survey and data collected by the authors, it is demonstrated that social capital is a positive determinant of self‐employment earnings. The role that neighbourhoods play in fostering social capital and improving microentrepreneurial performance are also highlighted.

Item Type:	Article
Official URL:	https://onlinelibrary.wiley.com/journal/15405982
Additional Information:	© 2001 Canadian Economics Association
Divisions:	Management
Subjects:	H Social Sciences > HG Finance H Social Sciences > HD Industries. Land use. Labor
JEL classification:	J - Labor and Demographic Economics > J2 - Time Allocation, Work Behavior, and Employment Determination and Creation; Human Capital; Retirement > J23 - Employment Determination; Job Creation; Demand for Labor; Self-Employment O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O17 - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements: Legal, Social, Economic, and Political Z - Other Special Topics > Z1 - Cultural Economics; Economic Sociology; Economic Anthropology > Z13 - Social Norms and Social Capital; Social Networks
Date Deposited:	06 Nov 2008 15:03
Last Modified:	13 Sep 2024 21:23
URI:	http://eprints.lse.ac.uk/id/eprint/17008

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