Scale economies and input price elasticities in microfinance institutions

Valentina Hartarska (), Xuan Shen and Roy Mersland ()
Additional contact information
Roy Mersland: UIA - University of Agder

Post-Print from HAL

Abstract: We evaluate the efficiency of microfinance institutions (MFIs) using a structural approach which also captures these institutions' outreach and sustainability objectives. We estimate economies of scale and input price elasticities for lending-only and deposit-mobilizing MFIs using a large sample of high-quality panel data. The results confirm conjectures that improvements in efficiency can come from the growth or consolidations of MFIs, as we find substantial increasing returns to scale for all but profitability-focused deposit-mobilizing MFIs. Our results support the existence of a trade-off between outreach and sustainability. All inputs are inelastic substitutes, but we find differences in own-price elasticities in lending-only and deposit -mobilizing MFIs.

Keywords: JEL classification: G21; F30 Microfinance; Efficiency; Input price elasticity; Scale economies; Microfinance institutions; JEL classification: G21 F30 Microfinance Efficiency Input price elasticity Scale economies Microfinance institutions (search for similar items in EconPapers)
Date: 2013
Note: View the original document on HAL open archive server: https://hal.science/hal-05220857v1
References: Add references at CitEc
Citations:

Published in Journal of banking & finance = Journal of banking and finance, 2013, 37 (1), pp.118-131. ⟨10.1016/j.jbankfin.2012.08.004⟩

Downloads: (external link)
https://hal.science/hal-05220857v1/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05220857

DOI: 10.1016/j.jbankfin.2012.08.004

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().