Institutions and social capital in group lending

Institutions and social capital in group lending

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Formal institutions rawafricaonline.com and social capital interact with each other in multiple ways.We argue and show empirically at the cross-country level that in the case of group lending, contract enforcement complements bonding social capital and substitutes for bridging one.It means that payoff to social capital in group lending depends on stuart products emcelle tocopherol social capital type and is contingent on the quality of contract enforcement which serves as a sorting factor, working in the opposite directions for different stripes of social capital.These results are robust to various estimations, sets of controls, and social capital measures.