Evolving Economic Forces (Asynchronous Session)
Integrating Market Conditions to Regulatory Decisions in a Financial Inclusion Context: Does Competition Matter? View Digital Media
Paper Presentation in a Themed Session Tristan Caballero Montes
The microfinance industry has rapidly developed and commercialized since its early days, exacerbating competition and emphasizing the attention paid to profits. As a response, many governments have been tempted to cap lending interest rates, a measure generally considered as socially counterproductive. With a consolidated dataset including 986 microfinance institutions from 73 countries over 2015-2018, we assess the effect of interest rate caps on the average loan size provided by microfinance institutions with fixed-effect regressions. Going one step further, we use a moderation analysis with multiple indicators, including the Herfindahl-Hirschman and Lerner indexes, to understand how competition affects this initial relationship. Our findings confirm that institutions facing interest rate caps provide larger loans on average, a sign of exacerbated financial exclusion, and suggest that competition amplifies this phenomenon. This paper bring two main contributions. First, it provides regulators with a better understanding of the impact and perverse effects of interest rate restrictions in a sensitive focused on the financial inclusion of the poor. In addition, they open the door to a new, more systemic approach of analyzing regulatory decisions and their impact, by integrating market conditions to the equation.
Supply Chain Sustainability and Dynamic Effects of Demand and Supply Evolutions View Digital Media
Paper Presentation in a Themed Session Masoud Khakdaman, Pascal Wissink, Wout Dullaert, Dirk Inghels
The sustainability transition for supply chains requires the optimization between economic, environmental, and social objectives in order to safeguard competitive advantage. Contemporary supply chains are confronted with demand and supply that is compounded by technology, legislation, and customer requirements for increasing sustainability. Although the dynamics of these individual components are well understood, the interactions deserve more attention to allow supply chain partners to better position themselves in their pursuit towards a circular economy. In this paper we discuss the dynamic interactions within the European aluminum rolled products supply chain partners. Because of its light weight and endless recyclability, aluminum is expected to increasingly grow the next decades in business sectors such as transport, building and construction and packaging. Based on input form supply chain partners and European Aluminum, we present a systems dynamics model that is capable to deal with the most important dynamic interactions in this supply chain. Results reveal potential pathways for improving sustainability of European aluminum industry.
The WIR Money View Digital Media
Paper Presentation in a Themed Session Ottavio Calzone
In times of economic crisis, in addition to bartering, alternative currencies often have a comeback and new alternative currencies are created: such is the case of WIR, an alternative currency parallel to the Swiss franc, which was created during the crisis of 1929 and is still being used today. WIR is simultaneously a currency, a bank, an exchange circuit and a marketing tool. This study illustrates the functioning of this unique currency.
