Comparison of four microfinance markets from the point of view of the effectuation theory, complemented by proposed musketeer principle illustrating forces within village banks

Hes Tomáš (), Sulaiman Haiyan, Bali Chávez Guillermo, Mintah Samuel and Salman Ali
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Hes Tomáš: Czech University of Life Sciences Prague, Prague, Czech Republic
Sulaiman Haiyan: Czech University of Life Sciences Prague, Prague, Czech Republic
Bali Chávez Guillermo: Comisión Nacional Para El Desarrollo De Los Pueblos Indígenas, Mexico City, Mexico
Mintah Samuel: Czech University of Life Sciences Prague, Prague, Czech Republic
Salman Ali: Syrian Virtual University, Damascus, Syrian Arab Republic

Management & Marketing, 2017, vol. 12, issue 1, 37-48

Abstract: Microfinance services are essential tools of formalization of shadow economics, leveraging immature entrepreneurship with external capital. Given the importance of shadow economics for the social balance of developing countries, the importance of an answer to a question of how microfinance entities come into existence, is rather essential. While decision-taking process leading to entrepreneurship were explained by the effectuation theory developed in the 90’, these explanations were not concerned with the logics of creation of microenterprises in neither developing countries nor microfinance village banks. While the abovementioned theories explain the nascence of companies in environment of developed markets, importance of a focus on emerging markets related to large share of human society of microfinance clientele is obvious. The study provides a development streak to the effectuation Theory, adding the musketeer principle to the five effectuation principles proposed by Sarasvathy. Furthermore, the hitherto not considered relationship between social capital and effectuation related concepts is another proposal of the paper focusing on description of the nature of microfinance clientele from the point of view of effectuation theory and social capital drawing a comparison of microfinance markets in four countries, Turkey, Sierra Leone, Indonesia and Afghanistan.

Keywords: informal economics; village banks; SME; business; effectuation theory (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:manmar:v:12:y:2017:i:1:p:37-48:n:3

DOI: 10.1515/mmcks-2017-0003

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