Kumar Aniket | University of Cambridge (original) (raw)

Papers by Kumar Aniket

Ese Discussion Papers, Feb 1, 2006

Saving opportunities can only be offered in group-lending by restricting the number of borrowers ... more Saving opportunities can only be offered in group-lending by restricting the number of borrowers in a group, thus creating intra-group competition for loans. Our model predicts that this would lead to negative assortative matching along wealth lines (the wealthy would group with poorer individuals). We find that in a two member group, the borrower's wealth threshold for joining the group would be greater than the non-borrower's wealth threshold. The non-borrower's wealth threshold increases and the borrower's wealth threshold decreases with the cost of capital, thus widening the gap between the two thresholds. We thus highlight the two countervailing effects of subsidising the cost of capital, i.e., the trade-off between raising the wealth threshold for joining the group as a non-borrower and decreasing the expected time it would take to loosen the wealth deprived non-borrower's credit constraints.

Ese Discussion Papers, Dec 1, 2005

SSRN Electronic Journal, 2000

The paper examines the pros and cons of lending sequentially to a group, composed of two wealthle... more The paper examines the pros and cons of lending sequentially to a group, composed of two wealthless individuals who are jointly liable for each other's project outcome. Sequential lending entails lending to one borrower per period, with the proviso that the second borrower's loan is contingent on the first borrower's project succeeding. We show that in a moral hazard environment, where the borrowers can influence their peer's effort through costly monitoring, the borrowers are allocated smaller rents in sequential as compared to simultaneous group lending. Conversely, the lender's capital is less productive in sequential as compared to simultaneous lending. Thus, for a sufficiently efficient peer monitoring technology a greater range of projects is feasible under sequential lending.

A series of lecture on the theory of microfinance. Using contract theoretic models, the lecture s... more A series of lecture on the theory of microfinance. Using contract theoretic models, the lecture summaries the current research in the microfinance. The lecture cover consumption credit, adverse seletion, moral hazard and contract enforcement.

ESE Discussion Papers, 2006

This paper shows that subsidising the cost of capital restricts the ability of the poorest to par... more This paper shows that subsidising the cost of capital restricts the ability of the poorest to participate in the group lending mechanisms that include saving opportunities. We document the group lending mechanism used by a typical microfinance lender in Haryana, India. Individuals ...

Trinity College, University of Cambridge, mimeo, …, 2010

The implicit assumption in microfinance literature has been that offering the poor credit is the ... more The implicit assumption in microfinance literature has been that offering the poor credit is the most efficient way to alleviate poverty. This paper examines the optimal design of group-lending microfinance institutions that offer both saving and borrowing opportunities. Offering saving opportunities leads to negative assortative matching within the group along wealth lines, i.e., there is significant wealth heterogeneity within the endogenously formed groups. Further, the paper shows that under reasonable assumptions, the microfinance institutions that offer both borrowing and saving opportunities could reach poorer individuals than institutions that only offer borrowing opportunities.

The case-study examines the group lending mechanism of a par-ticular Microfinance Institution wor... more The case-study examines the group lending mechanism of a par-ticular Microfinance Institution working in Haryana, India. The Mi-crofinance Institution restricted the number of group members that could borrow simultaneously from it and allowed the internal lending amongst the ...