Abstract:Do institutions and social capital provide a viable means for advancing the goals of poverty reduction programs in low capacity states? This question has particular importance for Nigeria and Africa as a whole because of the poor performance of poverty reduction programs despite domestic and global efforts to reduce poverty in the continent. In this paper, I assess the usefulness of the informational aspects of the new institutional economics and the social network method of social capital paradigm in reducing… Show more
“…This section (pp. 3–11) draws heavily on Aideyan (). Most approaches to poverty alleviation neglect the context in which the policies are implemented and instead focus on income and subsidy measures.…”
Section: Conceptual Components Of the Social‐institutional Framework mentioning
confidence: 99%
“…These classics provide the foundation for recent studies on the impact of institutions and social relations on development outcomes, and microfinance in particular. The usefulness of this framework in accounting for the success and failure of credit markets for the poor in Nigeria is summarized in Aideyan ().…”
Section: Conceptual Components Of the Social‐institutional Framework mentioning
confidence: 99%
“…Following from above, this study identifies and highlights five explanatory variables of the social‐institutional framework that are linked to the success of small‐scale financial institutions, namely, information sharing, horizontal and vertical linkages, institutional capacity, competence, and autonomy (Aideyan, ; Baas & Rouse, ; Chaves & Gonzalez‐Vega, ; Ehigiamusoe, ; Hulme & Mosley, ; Otero & Rhyne, ; Shetimma, ). When applied to microfinance programs, these dimensions correspond, respectively, to (i) members, entry and initiation; (ii) group ownership and control; (iii) group task; (iv) information and transaction component; (v) lending process and social collateral; (vi) borrower and lender accountability and mutual respect; (vii) incentives; and (viii) decentralization of decisions.…”
Section: Conceptual Components Of the Social‐institutional Framework mentioning
confidence: 99%
“…More specifically, these innovative rules and procedures form the core of the informational aspects of the new institutional economics, and the social network or group relationships of the social capital paradigm. The general proposition of this paradigm, simply put, states that the livelihoods of the poor can be promoted on the one hand by designing programs to reflect some regularities (formal and informal rules and regulations) that best enhance benefits and mitigate costs faced by the poor for obtaining services, and on the other hand a mobilization of cohesive social relationships based on existing networks of semiautonomous units, which substitute for weak enforcement of contracts to reduce the service delivery costs to the poor (Aideyan, ).…”
Do creative institutional design and social networks of poverty reduction programs in impoverished countries lower access and transaction costs for the poor and service providers? This question, while important for all impoverished countries, draws particular interest in the African context because there is too much emphasis on whether and why these programs work and not how programs should work in societies that are characterized by uncertainty, hostility to the interests of the poor, and unpredictability in constraining the activities of self-interested actors. To test whether creative institutional design features and social networks can lead to successful provision of credit to the poor, this article draws on existing records and original rigorous qualitative data on the organizational policies and behavior of borrowers existing in the Lift Above Poverty Organization (LAPO), a national microfinance institution in southern Nigeria, to examine how innovative rules and procedures reduce the access costs faced by the poor for obtaining credit and other services for improved welfare and enhanced productivity. The overall assessment shows that there is a strong relationship between programs, which emphasizes institutional design mechanisms to overcome typical problems of implementing programs that benefit the poor.
“…This section (pp. 3–11) draws heavily on Aideyan (). Most approaches to poverty alleviation neglect the context in which the policies are implemented and instead focus on income and subsidy measures.…”
Section: Conceptual Components Of the Social‐institutional Framework mentioning
confidence: 99%
“…These classics provide the foundation for recent studies on the impact of institutions and social relations on development outcomes, and microfinance in particular. The usefulness of this framework in accounting for the success and failure of credit markets for the poor in Nigeria is summarized in Aideyan ().…”
Section: Conceptual Components Of the Social‐institutional Framework mentioning
confidence: 99%
“…Following from above, this study identifies and highlights five explanatory variables of the social‐institutional framework that are linked to the success of small‐scale financial institutions, namely, information sharing, horizontal and vertical linkages, institutional capacity, competence, and autonomy (Aideyan, ; Baas & Rouse, ; Chaves & Gonzalez‐Vega, ; Ehigiamusoe, ; Hulme & Mosley, ; Otero & Rhyne, ; Shetimma, ). When applied to microfinance programs, these dimensions correspond, respectively, to (i) members, entry and initiation; (ii) group ownership and control; (iii) group task; (iv) information and transaction component; (v) lending process and social collateral; (vi) borrower and lender accountability and mutual respect; (vii) incentives; and (viii) decentralization of decisions.…”
Section: Conceptual Components Of the Social‐institutional Framework mentioning
confidence: 99%
“…More specifically, these innovative rules and procedures form the core of the informational aspects of the new institutional economics, and the social network or group relationships of the social capital paradigm. The general proposition of this paradigm, simply put, states that the livelihoods of the poor can be promoted on the one hand by designing programs to reflect some regularities (formal and informal rules and regulations) that best enhance benefits and mitigate costs faced by the poor for obtaining services, and on the other hand a mobilization of cohesive social relationships based on existing networks of semiautonomous units, which substitute for weak enforcement of contracts to reduce the service delivery costs to the poor (Aideyan, ).…”
Do creative institutional design and social networks of poverty reduction programs in impoverished countries lower access and transaction costs for the poor and service providers? This question, while important for all impoverished countries, draws particular interest in the African context because there is too much emphasis on whether and why these programs work and not how programs should work in societies that are characterized by uncertainty, hostility to the interests of the poor, and unpredictability in constraining the activities of self-interested actors. To test whether creative institutional design features and social networks can lead to successful provision of credit to the poor, this article draws on existing records and original rigorous qualitative data on the organizational policies and behavior of borrowers existing in the Lift Above Poverty Organization (LAPO), a national microfinance institution in southern Nigeria, to examine how innovative rules and procedures reduce the access costs faced by the poor for obtaining credit and other services for improved welfare and enhanced productivity. The overall assessment shows that there is a strong relationship between programs, which emphasizes institutional design mechanisms to overcome typical problems of implementing programs that benefit the poor.
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