Viewing all FaiV posts with topic: Insurance  

Week of September 17, 2018

1. MicroDigitalFinance: A few weeks ago I wrote that small-dollar short-term loans have always been the bane of the banking industry. We're getting a new test of that. US Bank is launching an alternative to payday loans: loans are between $100 and $1000 and repaid over three months. Interest rates are well below payday lending rates, but still around 70% APR--interestingly on US Bank's page about the loan they very clearly say: "Simple Loan is a a high-cost loan and other options may be available." All of that is good news. But the loans are only available to people with a credit rating (even if it's bad), who have had bank accounts with US Bank for 6 months and direct deposit for 3 months. It will be fascinating to watch take-up, repayment rates, and outcomes--those are where banks have always struggled in this market. Here's Pew's Nick Bourke's take on the US Bank move and the potential for others, with some more regulatory action, to follow suit.
I occasionally remark on insurance being the most amazing invention of all time. It's astounding that it works at all, even in the most developed, trusting and well-regulated markets (see this attempt by one of the US's oldest life insurance providers to collapse the market); it's not surprising that it's a struggle to make it work elsewhere, in the places where households face more risk and would most benefit from access to insurance. So I'm always interested in new work on insurance innovation. Here's a new paper on a lab-in-the-field insurance experiment in Burkina Faso. The basic insight is that many potential purchasers struggle with the certain cost of an insurance premium versus the uncertain payoff. It turns out that framing the premium around an uncertain rebate if there is no payout--which makes both premium and benefit uncertain--increases take-up, especially among those that value certainty most. Yes, you probably need to read that sentence again (and then click on the link to see that even that obtuse sentence is marginally clearer than the abstract). If we want to delve into the details of insurance contract construction, there's also a new paper that delves into how liquidity constraints--a huge factor that hasn't generally gotten enough attention--affect the perceived value of insurance contracts, and how to adjust the contracts accordingly.
And finally, William Faulkner's dictum that "The past is never dead. It's not even past." applies to fintech. A new paper finds that common law countries in sub-Saharan Africa have greater penetration of Internet, telecom and electricity infrastructure, and thus much greater adoption of mobile money and FinTech. That's consistent with history of banking literature that finds common law countries do better on financial system development, financial inclusion and SME lending. 
For the record, I've clarified in my own mind the difference between the MicroDigitalFinance and Household Finance categories. The former provides perspective on providers, the latter on consumers. I reserve the right to break that typology as necessary or when it suits me.  

2. Household Finance: I suppose another way to distinguish between the two categories is that MicroDigitalFinance features bad news only most of the time, while Household Finance is just all bad news. At least that's the way it feels when I come across depressing studies like this: Extending the term of auto loans (e.g. from 60 months to 72 months as has become increasingly common during this low-quality credit boom) leads to consumers taking loans at a) higher interest rates, and b) paying more for the vehicle. Liquidity constraints mean consumers pay much more attention to the monthly payment and get screwed.
It's not just auto loans where liquidity constraints lead to people making sub-optimal choices (yes, I'm thinking a lot about managing liquidity lately). For instance, when people move from traditional health insurance to high-deductible plans they suddenly reduce spending on health care--but not in the ways you want. People don't learn to price shop, even after two years, and they don't reduce spending only on optional or low-value services. And here's the JP Morgan Chase Institute study that shows how much liquidity constraints or their removal affect health care spending using a different approach.
Now if you are a loyal faiV reader, I know you're not thinking, "We need financial literacy training!" But just in case, here's some more bad news: "peer-to-peer communication transmits financial decision-making skills most effectively when peers are equally uninformed, rather than when an informed decision maker teaches an uninformed peer." Or this: "provision of effective financial education to one member of a pair...does not lead to additional improvements in the quality of the untreated partner's decisions." 
If you're thinking, "That hasn't ruined my Friday yet, Tim, give me more," don't worry. How about "Twenty-four million homeowners think it's acceptable to tap into home equity to cover everyday payments." Granted, that's from one of those ridiculous surveys that should be taken with several kilos of salt, but still. 

3. Our Algorithmic Overlords: Here's a quick story about an egregiously bad algorithm the State of Idaho was using to determine how much assistance Medicaid recipients should receive. You can probably already guess--bad data, bad software, bad implementation. But it took a lot of work, and a lawsuit, to figure that out. 
Stories like that emphasize that before handing over decisions to our algorithmic overlords we should want those algorithms to be understandable and fair. Here's a new paper from Jon Kleinberg and Sendhil Mullainathan developing a model that shows you have to pick between simple and equitable. You can't have both.
And here's the "Anatomy of an AI System" that in some ways is a visual proof of the Kleinberg and Mullainathan paper. It's also one of the coolest visualizations I've seen in a while--both in scope and because it isn't reductionist about AI. It takes into account all of the surrounding processes as well. You won't regret clicking on this, unless you have something else really important to do.

4. Global Development: So many things to include this week. Let's start with the biggest: Asher, Novosad and Rafkin have assembled an incredible dataset on incomes in India that allows them to measure intergenerational mobility in a country of more than a billion people, down to the level of 5600 rural districts and 2300 cities and towns. One key finding: increasing mobility among scheduled castes is offset by decreasing mobility among Muslims.
At a necessarily smaller scale, but still big in terms of scope and time, Casey, Glennerster, Miguel and Voors have a long-term follow up on the results of a large scale experiment on Community Driven Development in Sierra Leone, finding that CDD doesn't break down traditional autocratic governance mechanisms enough to allow full exploitation of human capital, which as I understand it was part of the motivation for CDD, and there are easier and cheaper ways to to do so. Of note, they also look at the "prior beliefs of experts on likely impacts"--which, given the "Everything Is Obvious" responses research like this often generates, is pretty cool. Here's Rachel's Twitter thread summary.
Another of the arguments I've heard both for and against CDD-style programs is side-stepping difficult targeting questions--just let the community decide who needs help. Rema Hanna and Ben Olken have a new paper on targeting, specifically on the relative welfare gains of universal basic income versus means-testing. They find means-testing wins using data from Indonesia and Peru, despite some issues; and they discuss adding community-targeting to means-testing.
Meanwhile, here's a piece by Josh Blumenstock that tries to deflate some of the excitement around using high-tech means of targeting, like satellite maps, social networks and call records. In summary, data without theory is useless, and so is data + theory without anthro/soc (or at least anthro/soc informed economics).

5. Methods and Evidence-Based Policy : That's a good lead-in to methods. Let's start with some quick hits. Brian Wansink, whose scandals I've covered in this item in the past, has resigned from Cornell. Noah Smith has a column on the replication crisis in Economics though it's about a very different kind of replication crisis than the one Wansink faced. Now that I type that, it occurs to me that it was in fact easy to replicate Wansink--just making up numbers that matched his would apparently be both a literal and conceptual replication. And here's a new paper on improving diff-in-diff methods to account for effects changing over time.
The idea of evidence-based policy sort of requires that there is evidence of something working. But y'know, nothing does. Encouraging women to get mammograms? Those most likely to respond are those least likely to need one, and because of false positives, the net welfare effect is negative. The health effect of better trade and transport links in the United States in the early 19th century? So negative that it made it people shorter (I mean, as a whole, not specific people). What else? Oh, those gains we all know of like improved water and sanitation, and food safety standards during the early 20th effect on total or infant mortality. That last one reminds me of an old LantRant about assessing whether development interventions matter based on whether they were important in the history (or present) of developed countries. Shall we scratch food safety and urban sanitation off that list? 
I suppose we can hope that these results won't replicate, like the examples that Noah Smith cites. But on the other hand, it's already too late. Once a result is published, no one (or at least no doctors) changes their mind, or changes their behavior.
Wow, this has been bleak. So here's one hopeful note on something that did work. Women's suffrage caused large gains (via demand for more spending on education) in educational attainment of poorer/disadvantaged children, and long-term earnings gains. So go out this weekend and help a woman register to vote (and then go back and make sure she has everything she needs to follow through and vote on election day).

I would have had the Anatomy of an AI visualization here, but it's way too big, and  Justin Sandefur  created this really great example of how simple choices in the visual representation of data can radically change the way we interpret it. The two charts are of the same data, on the left from the World Bank and on the right from The Economist. Via  Justin Sandefur .

I would have had the Anatomy of an AI visualization here, but it's way too big, and Justin Sandefur created this really great example of how simple choices in the visual representation of data can radically change the way we interpret it. The two charts are of the same data, on the left from the World Bank and on the right from The Economist. Via Justin Sandefur.

Week of July 23, 2018

The In Bloem Edition

Editor's Note: My writing hiatus from the faiV continues. This week Jeff Bloem, a PhD student in the Applied Economics Department at the University of Minnesota, and faithful reader of the faiV, takes over. You can follow Jeff on Twitter and, yes, via his own blog. Be sure to check out his review of what sounds like a fascinating, must-read book.--Tim Ogden

1. Food Fights and Methods: First, over on the Economics That Really Matters blog, Paul Christian and Chris Barrett summarize their paper on US food aid and conflict. They call into question the results of an influential paper finding a causal link between US food aid and conflict. The authors follow up with a methodological note on the use of instrumental variables with panel data.
Next, the most recent issue of the American Journal of Agricultural Economics (AJAE) has a nice article, comment, and response. In the article Ore Koren finds that it is food abundance, rather than food scarcity, that causes conflict across Africa. Marshall Burke writes in a comment that the effect sizes are implausibly large and are at odds with previous research. Koren responds to these comments by offering three explanations for the "implausibly" large effect sizes.     

2. Randomistas are our new Algorithmic Overlords: At the development economics section of the NBER Summer Institute, Esther Duflo delivered a lecture entitled, "Machinistas meet Randomistas: Some useful ML tools for RCT researchers". Slides from the lecture are available here, and Dina Pomeranz was live Tweeting the lecture. The paper it was based on is here. On the surface it may seem like machine learning and RCTs are interested in different parts of empirical research--the former focused on prediction and the latter focused on causal identification. Duflo highlights a couple areas where using machine learning when analyzing an RCT can be beneficial.

3. Informal Insurance: In a recent article on VoxDev, Kaivan Munshi and Mark Rosenzweig summarize some of the insights from their 2016 paper on the impact of rural informal insurance networks on rural-urban migration in India. The authors first point out that the rural-urban migration rate is relatively low in India compared to other similar countries. The explanation for this is the presence of well-functioning rural informal insurance markets. In order for these informal markets to function well, however, mechanisms must exist to prevent households from reneging on their obligations to their network. A key way this plays out is in restrictions on mobility. This raises a question: What would happen if formal insurance were introduced? Munshi and Rosenzweig run policy simulations and find formal insurance arrangements may increase rural-urban migration. Relatedly, in a new AJAE paper, Kazushi Takahashi, Chris Barrett, and Munenobu Ikegami study how the introduction of formal index insurance affects informal risk-sharing arrangements in rural Ethiopia. They find little evidence of a crowding out of informal insurance from formal insurance products.

4. The Power of Hope: This has already been shared quite a bit, but if you haven't read Seema Jayachandran's summary in the New York Times of the literature on hope and aspirations… you should. The article briefly discusses three recent studies. First, a study in Kampala, Uganda examined the effects of students watching the movie "Queen of Katwe" on educational performance. Second, a study in Oaxaca, Mexico showed an inspirational documentary to women eligible for small business loans. Finally, a study in Kolkata, India designed a psychological training program for sex workers. In each of these studies, these treatments lead to measurable changes in internal characteristics--for example: self-esteem, aspirations, self-efficacy, optimism--and also concrete changes in educational attainment, enterprise revenues and profits, and personal savings.

5. Sanitation: NPR's Planet Money podcast has a nice story about work in Dakar, Senegal helping improve the market for septic tank cleaning. The podcast frames the work as breaking up a "poop cartel." This is a catchy way frame the story, but the truth is urban sanitation is a very important issue in many developing countries. In many places with rapid urbanization and sprawling city footprints, organizing and funding the provision of environmentally-friendly sanitation services is a vexing challenge. This work offers some important insight in how cities might boost sustainable improvements of their sanitation services. More information about this research is available here.


From VoxEu, some data on something we all knew, but perhaps not this specifically and depressingly. Via  VoxEU .

From VoxEu, some data on something we all knew, but perhaps not this specifically and depressingly. Via VoxEU.

NEUDC 2016 Special Edition

Editor's Note: The Northeastern Universities Development Consortium (NEUDC) conference was hosted at MIT this weekend. Over two days you get to see an enormous amount of new development research by mostly younger researchers. I held back on faiV this past week, to bring you this special edition--featuring the five papers I found most interesting (of those that are shareable) and since there are far more papers presented than any one person can take in, I recruited Jessica Goldberg, a development economist at Maryland (responsible for interesting papers like this); she in turn recruited Emily Breza (responsible for interesting papers like this) of Columbia GSB and soon of Harvard to contribute; and Lee Crawfurd (also known as Roving Bandit in the glory days of the development blogosphere) of CGD and a PhD candidate at Sussex to weigh in with their own favorites.

Here's my list of the 5 most interesting papers from the weekend:

1. Mentors for Microenterprises in Kenya: Brooks, Donovan and Johnson assign high profit microentrepreneurs to mentor newer entrants. That's a particularly interesting way to potentially change the trajectories of microfirms. The mentored firms see a significant jump in profits driven by learning how to cut costs but don't maintain the gains once mentorship stops.

2. Grants and Plans for Senegalese Farmers: Ambler, de Brauw and Godlonton give $200 grants and develop a farm management plan for smallholders. The grants boost production (by more than $200), but the gains seem to fade out, though higher stock of assets remains. Farm management plans don't have a measurable impact. I find this interesting for many of the same reasons as #1: figuring out how to boost profits of small enterprises is near the top of my list of urgent program/policy questions.    

3. Seasonal Migration in India:  Imbert and Papp use NREGA and choices about short-term migration to better understand why the large gap in earnings between rural and urban migration doesn't lead to more seasonal migration. They estimate that more than half of the income gap is consumed with higher living costs in urban areas, with the rest due to non-economic costs--like being away from home and "hard-living", (e.g. sleeping on the street). There are some interesting policy applications for the design of rural public works/income programs and the development of migration finance and support programs. 

4. Crop insurance contracts in Kenya: There's a general consensus that insurance is one of the most promising margins to help poor households, but we're a long way from figuring out to efficiently and effectively deliver an insurance product that people will take up. Casaburi and Willis study an insurance program in Kenya where farmers can delay the premium payment--noting that premia are usually due at the point where farmers are most liquidity constrained (they can delay payments because the crop is sugarcane farmed under contract so premia can be collected from harvest proceeds). They find a 67 percentage point boost in take-up, with take-up highest among poorest farmers.

5. Saving and Smoothing: One of the ways that financial services should help poor households the most is by boosting their ability to smooth consumption and to absorb shocks. But access alone isn't enough if other constraints prevent households from using the tools like savings and insurance effectively. Aker et al. look at savings nudges to help Senegalese households save and budget. They find that lockboxes and reminders don't influence spending (particularly spending on festivals) but do seem to help households plan ahead and therefore be less susceptible to other shocks. There is a lot of heterogeneity in results though.

Jessica Goldberg's, with an assist from Emily Breza, list of 5 most interesting papers:

1. Gambling and Saving in Uganda: Betting on sports events is common among urban Ugandan men and, for those who partake, a substantial expenditure. This paper by Sylvan Herskowitz uses variation in bet outcomes and lab-in-the-field experiments to build a case that betting is a rational strategy for asset management in an environment with low perceived returns to savings.  It’s a novel topic — while we are learning a lot about savings, credit, and even mobile money, I haven’t read anything else about sports betting in developing countries.  But neither the topic nor the approach are trivial, and taking seriously the model that would rationalize the bets is commendable.

2. Workfare and Welfare: This paper from Bhanot, Han, and Jang uses a lab-in-the-field experiment in Kenya to test various attributes of common cash transfer or public works programs, and therefore contributes to the design of such programs. While many evaluations of cash transfer or public works programs focus on outcomes like employment, income, or consumption, this paper also measures subjective wellbeing, which is improved by requiring participants to exert effort in exchange for payment. This adds an additional justification for work requirements rather than cash transfer schemes, which is important since public works can be more expensive to administer and do not always achieve self-targeting.

3. Seasonal Migration in India: [Ed. Note: same paper as above] There’s a lot written about NREGA, but it’s a massive program that not only shares features with workfare programs in many other countries, but also operates at a scale that lets us understand what might happen programs that were rationed were instead made available to more people or for longer durations. Clement and John already have one really important paper about the equilibrium effects of NREGA on private sector wages.  Now, they show that NREGA reduces seasonal migration from rural areas to the cities

4. Crop insurance contracts in Kenya: [Ed Note: same paper as above]: This paper is a nice insight into understanding the demand for insurance, even though the specific pricing structure may be hard to implement outside of a closed marketing chain.  It’s also a contribution to the literature about how the timing of financial access affects outcomes.

5. Economics of Foot Binding: Fan and Wu look at the rise and fall of foot binding in China from an economic lens, particularly noting how the practice interacted with a gender-biased meritocracy and the physical demands of women's labor.

Lee Crawfurd's list of 5 most interesting papers:

1. Football and ethnicity in Africa: When their national football teams win, Chauvin and Durante find, Africans report weaker ethnic identity. [Ed. note: I'm sure Sepp Blatter is emailing this to the Nobel committee as I write]

2. Teaching at the right level in India: Second coolest paper--Muralidharan, Singh, and Ganimian find huge effect sizes from a computer system that gives kids tests, adapts to their level, and gives feedback.

3. Vote-buying in India: Green and Vasudevan are pretty modest about reducing vote-buying by 2 *million* votes with a radio campaign.

4. Aid, hospitals, schools and violence in Afghanistan: Child finds that US health projects reduced conflict, but education projects increased conflict.

5. Trader costs in Nigeria: Startz documents and explains trade costs for market traders in Lagos. We usually focus on how developing countries can export more, but there are also big welfare gains to be had from making importing easier so consumers get cheaper and better goods.

Andreyanov, Davidson and Korovkin find suspicious bidding patterns in Russian sealed-bid electronic procurement auctions, estimating that up to 10% are affected by corruption and up to 30% by collusion among bidders. According to Jessica Goldberg, their presentation has an even more striking chart showing winning bids occurring in the last minute.  Source .

Andreyanov, Davidson and Korovkin find suspicious bidding patterns in Russian sealed-bid electronic procurement auctions, estimating that up to 10% are affected by corruption and up to 30% by collusion among bidders. According to Jessica Goldberg, their presentation has an even more striking chart showing winning bids occurring in the last minute. Source.

Week of October 17, 2016

Editor's Note: I'm writing this week's faiV from Kigali and the MasterCard Foundation Symposium on Financial Inclusion. Last week's edition was supposed to be called "The Doha Round" which would make the name of this week's edition make much more sense.

1. News from Rwanda: An evaluation of the use of small-scale household solar panels in Rwanda finds that there are benefits but those are small and diffuse enough that subsidies will be needed to scale adoption. At the conference itself I learned that while 89% of Rwandans are "financially included" only 6% are "adequately served" according to recent FinScope data--a healthy reminder that heavy caveats are required when setting inclusion goals. The next step is to recognize (with a nod to James Scott) that in markets with high "inlcusion," under-served is a strategy not a condition. And while this isn't news about Rwanda, I learned about it in Rwanda: MFO is conducting garment worker financial diaries in southeast Asia which should help us understand a bit more of the difference between Blattman and Dercon's results in Ethiopia and Heath and Mobarak's results in Bangladesh. 

2. The Cost of Volatility: One of the common findings from financial diaries work around the world is the prevalence of income volatility, perhaps most surprisingly among US households. In the US Diaries data we see a lot of the volatility coming from variations in amount earned per week in the same job. There are lots of reasons to suspect that volatile schedules and the income volatility that flows from it is bad for households, but how bad? A new field experiment hints that it's really bad. Mas and Pallais randomize wage offers to potential staff for a national call center and find that workers aren't willing to sacrifice pay for a flexible schedule, but are willing to give up 20% of their wage to avoid having a schedule set by the employer with a week's notice.  

3. Measuring Poverty (over time):  Measuring poverty is tough and it's even harder to generate global estimates or cross-country comparisons. Some countries have official poverty lines, but use different methodologies to set them. Should those lines just be accepted? Should they be adjusted for purchasing power parity? If so, what data should be used to set the PPP? The World Bank's new report (commonly called the Atkinson report) with recommendations on how to handle these questions is out. Justin Sandefur interprets the recommendations as moving away from a global poverty line.

One of the reasons the World Bank cares about global poverty measures is to track poverty over time. Here's a new paper on the long-term (10 years) effects of cash transfers for households with children in Ecuador finding no improvement in test scores and only a 2% increase in school completion rates, which the authors say suggests that the cash transfers are not likely to affect intergenerational poverty (which seems a shockingly narrow channel for impact).

4. Reforming (Indian) Banking: Also in the realm of reports that may have an impact on more than a billion people, IFMR Trust has recommendations on modernizing India's banking system, primarily focused on changing how banks manage risk. Among the recommendations are allowing regional banks to use credit default swaps to hedge agricultural/commodity price risk and pushing the banking sector to use formal insurance against catastrophic weather risks rather than counting on the government to step in when large scale defaults occur.

5. Reform through Labor: Well, not quite. A few weeks ago we highlighted the Muralidharan and Niehaus work on NREGA. Here's a new paper on the effects of a public works jobs program for youth in Sierra Leone, finding big boosts in household income (e.g. not crowding out other income strategies), little increase in temptation goods and that many households use the increased income to set-up businesses. Reminds me a bit of Blattman et al in Uganda. Here's a new paper evaluating the effect of unemployment insurance requirements to be actively looking for new work on labor supply. It finds the requirements don't push people into lower wage jobs but do have a positive effect on lower-income workers speed to re-employment. 

Single papers shouldn't move your priors much, though. Here's a new systematic review of youth employment programs. It finds that about a third of programs succeed at helping youth get into the labor market, and that programs in middle- and low-income countries have a better success rate.

Bonus Update: Last week we had a piece on how hard it is to get people to buy insurance. Here's a new paper on pricing agricultural microinsurance. My tongue-in-cheek summary: Economists find that insurance companies and governments will need to hire economists ever year to figure out optimal pricing and subsidy.

In the midst of travel, conferencing and slow internet connections this week, I didn't come across any compelling graphics. So here's a picture of a mountain gorilla I took this weekend in Volcanoes National Park. I can highly recommend  gorilla trekking . Source: Me.

In the midst of travel, conferencing and slow internet connections this week, I didn't come across any compelling graphics. So here's a picture of a mountain gorilla I took this weekend in Volcanoes National Park. I can highly recommend gorilla trekking. Source: Me.

Week of October 10, 2016

1. Digital Identity: A few weeks ago we featured a paper on the general equilibrium effects of NREGA in India, which depends on a universal ID system. Next Billion takes a look at India's digital ID system and compares it with Pakistan's program.

2. Insurance (Is Hard All Over): When you read about attempts to launch microinsurance programs for developing countries, it can often seem like insurance markets work very well in developed countries. But insurance is hard no matter where you are, and may be getting harder due to climate risks and our human failings in thinking about large but rare risks. Here's a new brief from the Penn Wharton Public Policy Institute looking at how under-insured many American homeowners are and proposing some steps to get those people to buy insurance

3. Shocks and External ValidityTypically conversations about the external validity of an impact evaluation focus on whether a finding in one place applies to a finding in another place. Here's a new paper by Rosenzweig and Udry looking at external validity issues in the same place but in different times, specifically at how important aggregate shocks can be when impact is likely to vary over time (as with agriculture or schooling). I'm not sure how big a problem not considering time variance is, but it is a good reminder to examine assumptions when applying findings from impact evaluations.

4. Crops, Volatility, Saving and Malnutrition: There's been a lot of progress around the world in reducing childhood malnutrition and stunting, but rates are still shockingly high in India, given the economic development in the last few decades. Here's some new research that establishes that households "save" to deal with volatile prices of pulses by stockpiling wheat (which is less nutritious). In part, saving in wheat is driven by the cost of formal accounts to save in cash.

5. C-C-Ts in the USA: Doesn't quite roll off the tongue like R-O-C-K does it? MDRC, which ran the evaluation of the Family Rewards CCT program in New York, has a new cost-benefit analysis of the program (of note, taking Rozenzweig and Udry seriously, the program was run in 2007, and depending on the exact timing there was an aggregate shock during the program or shortly thereafter). They find that on average it cost $1.07 to deliver $1.00 of value to households, and the program "did not produce positive net present value for taxpayers."

A new way to represent funding needs and overhead costs for non-profits and social enterprises.   Source: Nonprofit Assistance Fund

A new way to represent funding needs and overhead costs for non-profits and social enterprises. Source: Nonprofit Assistance Fund

Week of July 27, 2015

1. Mobile Money: Vodafone and MTN announced plans to allow money transfers between East and Central African customers of either provider, marking a big step toward interoperability on the continent. The Wall Street Journal

2. Financial Management: FAI affiliate Ignacio Mas analyzes common behaviors and decision-making practices that underpin the financial management strategies of poor households. Upsides

3. Digital Payments: A new blog series explores mobile merchant payments in developing markets, with a focus on the factors it will take to build out the extensive networks necessary to provide value for both merchants and customers. CGAP

4. Financial Inclusion: When we talk about financial inclusion, we generally talk about national statistics. Researchers funded by BBVA have made an impressive attempt to better understand financial inclusion in the United States by measuring it, and some possible determinants of inclusion or exclusion, for individual metropolitan areas. BBVA

5. Microinsurance: This week marked the launch of the first edition of The State of Microinsurance, a magazine-style publication aimed at taking stock of the microinsurance sector from the point of view of various stakeholders. The Microinsurance Network 

Week of June 1, 2015

1. Income Volatility: Insights into employment opportunities in the "sharing economy" (and research from US Financial Diaries)  provide evidence that "life is no longer a matter of having or losing a job, but of stitching together a comfortable and secure quilt from a colourful range of fabrics."  The Globe and Mail 

2. US Poverty: Will a new "reality" show where families facing financial hardship play a version of the dictator game, judging how "worthy" another family is to receive a share of $101,000, undermine persistent myths and prejudices about low-income households, or is it just an incredibly crass, deplorable, and exploitative gimmick? The Nation

3. Financial Inclusion: IFMR research drives home the point that no matter what "inclusion initiatives" are launched, the behavior of agents will have a huge effect on whether accounts are opened and used in IndiaIFMR

4. Mobile Money: The mobile money landscape in Kenya is shifting - from a network of almost purely mobile money agents, to one where bank agents also have a significant market presence. This transformation could potentially mean more services and lower fees for customers. Helix Institute

5. Microinsurance: Can mobile tech improve the four key areas of microinsurance--marketing, pricing, distribution and product design--enough to make microinsurance mainstream? Dalberg/CGAP

Week of April 27, 2015

1. Impact Investing: There's no clear definition of "impact investing," made apparent by the US Council on Foundations' annual conference and the Milken Institute Global Conference both having impact investing tracks this week populated by quite different people. Read Tim Ogden's reflections from the Council on Foundations (Part 1Part 2 and Part 3) where the emphasis was on starting small, and Jean Case's take on Milken Institute's theme of going big.

2. Microinsurance: Does the microinsurance industry have anything to show after 10 years of experiment, investment and excitement? Not much, according to Peter Gross. CGAP

3. Remittances:  Since their initial launch two years ago, Orange and MTN's cross-border mobile money transfer services have exhibited rapid adoption rates and transfer activity in West Africa. Does this success signal potential disruption in the African remittance market or does the preexisting socioeconomic integration of the region make this a unique case? GSMA

4. Income Volatility: Concerned about managing cash surpluses and dealing with shortfalls? There's an app for that. The New York Times

5. Informal Financial Services:  After decades of economic mismanagement under the previous political regime, poor Burmese turn to informal providers like pawn shops to access credit and manage their financial lives. The Guardian

Week of December 8, 2014

N.B.  This will be the last issue of 2014 for The FAIV, which will return on January 9th.  FAI wishes all of our readers a happy and safe holiday season and a prosperous New Year! 

1. Poverty in the U.S.:  “It’s assumed that we’re not unstable because we’re poor, we’re poor because we’re unstable. So let’s just talk about how impossible it is to keep your life from spiraling out of control when you have no financial cushion whatsoever.”  Slate

2. Agricultural Loans:  Forgiveness of agricultural loans has been a common occurrence in India. it's about to happen again. But who gets the benefits and what happens after?  Bloomberg 

3. Cash Transfers: Evidence is building for positive impact of both unconditional cash transfers and graduation models for the ultra-poor. How do you decide between the two?  NextBillion

4. Microinsurance:  New research examines the profitability and client value of banking and retail correspondents in four countries as alternative insurance distribution channels.  ILO

5. The Unbanked:  Argentina is experiencing an uptick in armed robberies due to its citizens' distrust of banks and tendency to operate mainly in cash.  NPR

Week of November 3, 2014

1. Business Training:  Previous evaluations show the effectiveness of business training programs is mixed at best.  But a new paper finds (as with most things in life) it helps to have a friend.  The World Bank - Development Impact 

2. MFIs:  Can financial service providers address domestic violence among microfinance clients?  CFI

3. Savings:  In India, MFIs that offer savings products have a chicken and egg problem – they struggle to attract savings because their clients don't perceive them as a savings provider.  MicroSave

4. Remittances: New tools could help turn short-term remittance flows into long-term investments and allow remitters to have more control over how their funds are spent back home.  NextBillion

5. Agricultural Finance:  Many insurance programs for small farmers have not expanded beyond pilot testing. The challenge today is bring them to scale and make them sustainable.   The Guardian

Week of October 6, 2014

1. Financial Inclusion: India’s vision of boosting financial inclusion by building thousands of bank branches may be inadequate if those branches actively prevent customers from purchasing low-cost products.  IFMR

2. Insurance:  How can small firms protect themselves against risks and continue with expansion plans even in an environment of uncertainty?  The World Bank - Development Impact

3. Housing:  A new study finds that relative to homeowners, renters in the U.S. comprise a financially fragile population that is burdened by debt and lacks emergency savings. FINRA

4. Payments: Plastc wants to replace your entire wallet with a single card. The Verge

5. Impact Investing:  Mobile phones have positive effects for billions - but do socially-conscious investors see Nokia as an "impact company"? Interest in impact investing may be growing, but the field needs more concrete definitions and metrics. Stanford Social Innovation Review

Despite conventional wisdom, poor families DO save. However, they do not always have access to safe, reliable systems to build savings. Savings groups are one tool that help poor households better manage their financial lives.

Week of September 29, 2014

1. Savings:  How do you build credit without a bank account?  One strategy is linking savings group activity to credit bureaus and formalizing invisible financial activitythat already occurs in many households, including those in the U.S. Financial Diaries project. Vox

2. Financial Inclusion: What explains Latin America's financial inclusion gap? Poor-quality institutions, income inequality, and low educational achievements. Center for Global Development

3. Microcredit:  Smart Campaign responds to the recent debate on responsible pricing and self-regulation from the 17th Microcredit Summit in Mexico. NextBillion

4. Insurance:  Behavioral economics can provide insights for providers looking to increase insurance demand and defy the belief that "insurance is never bought, it is always sold." Microsave

5. Poverty in the US: Despite the fact that many low-income individuals qualify for both Medicaid and food stamps, there are significant gaps between eligibility and participation. Urban Institute

Week of September 1, 2014

1. Sustainable Development Goals:  FAI affiliate Michael Clemens reacts to the inclusion of migration policy in the latest draft of the UN's SDGs... Center for Global Development

2. Immigration:  ...while David Roodman evaluates the domestic economic impact of migration for receiving countries.  David Roodman

3. Payments: Together with MasterCard, Nigeria began the pilot phase of its new eID program, which combines biometric-based identification with an electronic payment system. AllAfrica

4. Microinsurance:  Rose Goslinga and her team at the Syngenta Foundation for Sustainable Agriculture sell crop insurance to give farmers whose crops fail early a second chance at a growing season. TEDSalon Berlin

5. Poverty in the US:  "Diet quality has improved among people of high socioeconomic status but deteriorated among those at the other end of the spectrum. The gap between the two groups doubled between 2000 and 2010." The Atlantic

Source:  XKCD imagines the possibilities  of actually having all the money in the world...

Source: XKCD imagines the possibilities of actually having all the money in the world...

Week of June 2, 2014

1. Financial Inclusion:  As part EMERGE: The Forum on Consumer Financial Service Innovation, attendees got a taste of what it is like (including how expensive it is) to be unbanked. American Banker

2. Student Debt:  Despite the fact that student debt in the US passed the $1 trillion mark, new research from the NY Fed shows many borrowers are not aware of what happens if they default. Liberty Street Economics

3. Financial Services: Google created a new service that searches Gmail accounts for correspondence from creditors then sends a reminder when a bill is due with the amount owed.

4. Microinsurance:  "How Mobile Phone Carriers Are Helping Insure The 4 Billion People Who Live Without A Safety Net" Fast Company

5. Mobile Money: The winning entries in BRAC's innovation fund for mobile money challenge include new approaches to promoting adolescent savings, microinsurance, and distributing disaster relief. BRAC Blog

Week of March 31, 2011

There’s some great reading this week on behavioral economics, mobile banking, over-indebtedness, microinsurance and more. Check it out and if you would like to make an addition to the list, please do so via comments.

Week of March 25, 2011

Lots of interesting articles and events this week. Check it out and please add any additional links that you think are important via comments.

Week of January 31, 2010

Follow us on Twitter @financialaccess!

2/4: FAI research from "Half the World is Unbanked" cited in Susy Cheston's Congressional testimony on #microfinance

2/3: New version of the FAI paper "Microfinance Games" available at

2/3: New version of the FAI paper "Behavioral Foundations of Microcredit" released at

2/2: Microfinance requires no donor money, says MicroRate's Stauffenberg What about "Smart Subsidies"?

2/1: RT @poverty_action An "anti-nudge" on the way to Mexico...

2/1: Great video of Sendhil Mullainathan alking at TEDIndia: "Solving social problems with a nudge".

2/1: New microinsurance journal launched at