Mike Munger of Duke University talks with EconTalk host Russ Roberts about microfinance. Munger argues that cultural forces make it difficult for some families to save, and the main value of microfinance is to allow a higher level of savings. Families are willing to save via microfinance even though returns can be negative. Munger argues that this counterintuitive result is possible when other means of savings are unavailable. Munger also discusses microfinance that is used for entrepreneurship and the potential role for microfinance in development.
Visionary Kushal Chakrabarti is providing a solution. design mind ON AIR’s Chris Sallquist spoke with Kushal, the founder and CEO of Vittana, a person-to-person micro-lending Web site that makes it possible for students, wanting to go to college in developing countries, to get loans.