How Do Gender Composition and Group Size Affect the Outcomes of Village Savings and Loans Associations?
A common perception within the microfinance movement is that women are better at saving than men, yet little empirical evidence exists that can support this perception. The Village Savings and Loan (VSL) model is a community-based microfinance model in which clients self-select into associations (VSLAs) and collectively save money. The accumulated savings form a source of capital from which the members of the association can borrow. Interest payments make the accumulated savings grow and at the end of a cycle the savings are shared out. The outcomes of the model depends thus on both individual and collective performance.
This paper examines how gender composition and group size can explain differences in individual as well as collective performance within the VSL-model. A cross-sectional analysis using data collected in Rwanda, suggests that members in larger groups perform better than members in smaller groups. Women are found to share out more if members of a majority group of women whereas men share out less if members of a majority group of women. The results for the collective performances show a positive level effect in average total share out and percentage increase in share value for groups with a majority of men.
Persson, E. (2010). How Do Gender Composition and Group Size Affect the Outcomes of Village Savings and Loans Associations? Master’s Thesis. Department of Economics. Stockholm University.
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