Blockchain Papers

Aymen Frija, Abderraouf Zaatra, Ihèb Frija, Hassen Abdelhafidh

No abstract is available for this record.

Hans Peter Grüner, Christoph Siemroth

Abstract We show how decentralized individual investments can efficiently allocate capital to innovating firms via equity crowdfunding. We develop a model where consumers have privately known consumption preferences and may act as investors. Consumers identify worthwhile investments based on their own preferences and invest in firms whose product they like. In the presence of aggregate demand uncertainty, an efficient capital allocation is achieved if all groups of consumers have enough liquidity to invest. If some groups of consumers cannot invest, capital flows reflect preferences of liquid investors but not future demand. Comparing with traditional financing forms, crowdfunding in the absence of liquidity constraints can be superior unless traditional financiers are fully competitive and perfectly informed.

*Mbonigaba Celestin & ** Olivia Martinez

This study investigates how decentralized finance adoption reshaped banking intermediation structures across emerging digital economies during the foundational digital finance expansion period between 2005 and 2014 by evaluating the conditional role of financial technology environments in accelerating institutional financial transformation. Using a balanced panel dataset of 1,760 institutional year observations constructed from harmonized global digital finance repositories, the study applies fixed effects panel regression, interaction-based moderation estimation, heteroskedasticity robust clustered inference, and multidimensional composite index modeling to estimate the structural relationship between decentralized finance adoption and banking disintermediation. The findings reveal that decentralized finance adoption exerted a strong positive and statistically significant effect on banking disintermediation, with blockchain technology integration and digital financial accessibility producing the largest structural effects on non-bank financial participation and intermediary transaction displacement. The results further demonstrate that supportive financial technology environments amplified decentralized finance driven transformation through enhanced digital infrastructure readiness, cybersecurity preparedness, and institutional adaptability. Interaction estimates remained robust across alternative specifications, lagged estimations, and sensitivity diagnostics, confirming stable ecosystem conditioning effects across heterogeneous institutional environments. The study extends financial innovation and institutional transformation theories by integrating utilization, infrastructure, accessibility, and governance systems within a unified decentralized finance architecture. The findings provide globally relevant policy guidance for regulators and digital finance institutions seeking to balance financial innovation, inclusion, and banking system stability within emerging digital economies.

Annamart Nieman

This article is aimed at augmenting current awareness of virtual currencies ("VCs") in the South African legal community. To this end, it introduces the reader to VCs in general and decentralised convertible VCs ("DCVCs") in particular. Due to their design and interaction with the real economy and currency, DCVCs are on the radar of many financial regulators worldwide. As Bitcoin is considered the leading type of DCVC in terms of value and volume, its early beginnings in South Africa are probed. Although regulation should follow innovation, awareness of the VC ecosystem will not only warrant appropriate regulatory intervention when the time comes, but will also enable the growth and development opportunities associated with VCs. South Africa has not promulgated any legislation pertaining to VCs. The potential applicability of all current legislation and regulations relevant to VCs calls for in-depth research. This article aspires to serve as an appetiser to do so.

Bussara Sripanich, Vilas Nitivattananon, Ranjith Perera

No abstract is available for this record.

Ashok Das

No abstract is available for this record.

Kristen Lowitt, Gordon M. Hickey, Arlette Saint Ville, Kaywana Raeburn · 7 authors

No abstract is available for this record.

Jiasun Li

No abstract is available for this record.

Dorcas Mugure Mwangi

The rationale for considering decentralization in anti-poverty programs is that it might have positive effects on the economic development. Decentralization brings the government closer to the people. Local officials are better informed on the local needs, and are thus more capable of providing the optimal mix of local policies. While the SMEs subsector constitute close to 80% of employment, it only contributes to about twenty percent (20%) of the Gross Domestic Product (GDP) in 2011 in Kenya. This implies dismal subsector performance despite its potential contribution to employment, income and equity as was asserted in the ILO report in 1972. The performance of the SMEs in Kenya is linked to several constraints among which the regulatory and institutional framework is alleged to be one of the factors. SMEs in Kenya are threatened for survival as a competitive enterprise. The purpose of the study was to establish the effect of devolution on small and medium enterprises performance in Kenya. The study adopted a descriptive survey research design. The target population of this study composed of representatives of the various industries including the matatu, dairy, supermarkets, jua kali and small manufacturing companies in Nairobi and its environs. The target population of this study was therefore 1015. The study used stratified random sampling method to select 10% of the respondents who formed a sampling frame of 102 respondents. Data was collected using questionnaires. Data was analyzed using descriptive statistics done with the help of software program SPSS version 21 and presented using frequency tables. In addition, multivariate regression model was applied to determine the relative importance of each of the two variables with respect to SME performance. The study revealed that that fees and levies, affect the performance of Small and Medium Enterprises in Kenya to a moderate extent. The study concluded that fees and levies, cess and rates by the county government affect the performance of Small and Medium Enterprises in Kenya. The study also concluded that SME financing mechanism, fair trading practices, capacity development, mechanism for value addition and increase in supply, distribution and access to goods and services affect the performance of Small and Medium Enterprises affect the performance of SMEs in Kenya. The recommends that the county government should use the finances collected from fees and levies, cess and rates in proper and controlled manner with a goal of improving the working environment for the SMEs in Kenya. The study also recommends that the county government should put in strict measures to ensure that there is no corruption in the fees and levies, cess and rates collection process to ensure that the amount collected do not go to the hands of few individuals and that a substantial amount can be received to support the plans and policies of the county government. The study suggested that a similar study should be carried out in other counties to find out whether it will yield the same results. The study focused on SMEs, another study should be carried out to find out the effect of devolution on large companies.

Yuli Andriansyah

Objective - This paper was aimed to explain the development of Islamic banks and their contributions in Indonesia local development. Methodology/Technique - The paper described data on essential financial data of Islamic bank in 8 provinces in Indonesia mainly in their economic growth, percentage of population living under the poverty line, along with Islamic financial indicators, i.e. asset, third parties fund, and financing. Findings - The results indicate that Islamic banks accomplish impressive financial performance reflected in fast growing in asset, third parties fund, and financing. In terms of financial intermediaries, Islamic bank also performs well as presented in a larger share of financing compared to third parties fund. Islamic banks are also resilient to local short-run shocks in the economy. However, the relation between these financial indicators with economic indicators is not likely very supportive mainly because Islamic bank's limited market share and issue in financial inclusion in Indonesia. Novelty - As a preliminary research in the relation between Islamic finance and local development particularly in a new emerging decentralized economy, this paper bear a worthy endeavour in expanding this field of study in the future. Type of Paper: Review Keywords : Local Development, Islamic Bank, Financial Intermediaries, Economic Growth, Poverty.

Matthew Smith, Tyler Moore, Michael Brenner, Böhme, Rainer

No abstract is available for this record.

Muhammedamin Hussen

Micro Financing Institutions (MFIs) loan provision to poor is proving as a key strategy for poverty alleviation and inadequate access to credit by the poor has been identified as one of the contributing factors to poverty. To this end, this studies aims at assessing linkages between MF loans Provision in line with local economic development and provide basis for policy formulation at regional and national level in regard to MFIs and LED. To attain this objective, studies from Ethiopia and other countries have been reviewed. Empirical reviews showed that these institutions provided opportunities for self-employment; improved women's security; autonomy, self confidence and status within the society and household; helped in improving children’s Education. Above all, as pro-poor program; they targeted the most vulnerable groups in society, particularly women, who remain confined to households with little or almost no assets. In Ethiopia, great efforts are being made since last two decades by expanding MFIs loan provision services to the various groups of the people specifically the poor to facilitate poverty reduction effort. Despite the increasing reliance on MFIs as one of the instrument to reduce poverty in Ethiopia; very little work has been undertaken to examine the linkage of the microfinance expansion with local economic development (LED) strategy of the particular region. The studies reviewed revealed that there has been duplication of business undertaken in various parts of the region. This is due to lack of linkage and synergy of the loan provision by MFIs to the LED strategy of a given local area in particular and regions in general. The reviewed literature indicated that on account of decentralization of the development plan to optimize the potential of each region and mobilize resources; the local governments have been empowered to undertake social and economic development endeavor. It has also been found that, the Growth and Transformation Plan (GTP) (2010/11-2014/15) and LED were closely aligned. The interconnection between GTP and LED existed directly through the micro-small scale enterprises (MSE), cooperatives and other associations. Since LED aims to create efficient and functioning local economies as a consequence it has a direct alignment with growth and transformation efforts. Therefore, linking the microfinance loan provision to the local development priority appeared is very critical for the sustainability of the MSE businesses to benefit from local available potential resources for poverty alleviation program. Empirical evidences reflected that the current urban policy, the MSE strategy and the regional development framework provided additional opportunities for the implementation of LED and creating synergy between MFIs & MSE in Ethiopia. In light of the above view, the current MFIs loan provisions and local development priority of various regions as very important point of emphasis unseen in Ethiopia. Moreover, the findings of the study revealed that there is clearly identified lack of synergy between MFIs, MSE, Cooperatives Agency, Local administrative apparatus and LED in various regions in Ethiopia. This necessitates  the stakeholders have to set policy that fills up  the gap and create strong linkage between MFIs loan provisions to LED priority of particular regions to assure the sustainability of MSE businesses; and enhances the contributions of MFIs for poverty alleviation in Ethiopia. All in all, the researcher recommends that both Federal, regional government and other concerned stakeholders to work towards digging deeper to find keys to success. Key words : MFIs Loan Provision, Linkages, LED strategy

Siniša Berjan, Hamid El Bilali, Mediterranean Agronomic, M. Kulina · 5 authors

Bosnia and Herzegovina (BiH) consists of two governing entities; the Federation of Bosnia and Herzegovina (FBiH) and the Republika Srpska (RS). Agriculture employs almost a fifth of the total labor force. Around 61% of the population lives in rural areas. Easy and timely access to reliable and updated information provided by extension services is crucial for agricultural and rural development. The paper aims at analyzing the public agricultural extension and advisory services (AEAS) in Bosnia. In particular, it analyses governance; human resources; gender; cooperation projects; decentralization; financing; role in building social capacity as well as advisory approaches, methods and media. Some recommendations to improve the AEAS performance are made. The paper is based on a literature review and semi-structured interviews as well as focus group discussions carried out in March 2011 with agricultural advisors in the RS. Modern AEAS started to exist in BiH in 2002 and are organized on entity level: the Agency for Providing Services in Agriculture in the RS and cantonal agricultural extension services in the FBiH. The National Extension Services for BiH project helped establishing cantonal and regional offices. The Advisory Services Agency has five regional offices. Advisors use many group (e.g. lectures, seminars, field days) and individual (e.g. farm visits, phone calls) extension methods and media (e.g. internet, leaflets, posters, brochures, mass media). Advisors focus mainly on crop and animal production, processing and marketing. They also assist producers to gather in cooperatives. Advisory services face many financial, management and technical problems. The traditional top-down approach is still widely used. Bosnian AEAS should be supported by providing them with the necessary means and resources as well as technical, managerial and soft skills to fully assume their crucial role. That is necessary to develop a well performing pluralistic, participatory, bottom-up, decentralized, farmer-led and market-driven advisory system.

David Groshoff

This manuscript builds on my existing research program that (a) broadly seeks to analyze laws, regulations, instruments, and policy levers that inhibit a market’s ability to recognize an asset’s intrinsic value, whether in terms of financial, social, or human capital, and (b) explores and advances interdisciplinary corporate governance theories by employing a heterodox economic analytic to derive its proposal to the paradox of an unregulated virtual currency market (Bitcoins) and an overly regulated crowdfunding market (Kickstarter). The manuscript functions not only as an homage to Charles MacKay’s legendary 1841 book, Extraordinary Popular Delusions and the Madness of Crowds, which described the human, social, and economic psychology of financial bubbles — particularly the Dutch tulip bulb bubble — but also as an offering of problems and proposals that crowdfunded and Kickstarted entrepreneurial businesses, including those funded by Bitcoin currencies, present for a wide swath of societal stakeholders. To describe the problem, this manuscript (i) describes behavioral finance, (ii) details the new entrepreneurial business possibilities that virtual currencies and crowdfunded entities can explore, (iii) describes how current rules and regulations represent unnecessary constraints to traditional equity-based funding models and concerning governance models of entrepreneurial enterprises, and (iv) questions why one form of capital deployment (currencies) may provide equity-like returns and unique governance, while the other form of investing (crowdfunding), provides only soft-dollar-like returns and no governance for middle-class investors. While both virtual currencies and crowdfunding represent risks, including economic bubble risk, this Article believes that a heterodox economic analysis demonstrates unnecessary constraints on entrepreneurial businesses imposed by extant regulation, regulators, and law and policymakers. To assuage these paradoxic problems for emerging business enterprises, this Article proposes a minarchist heterodox solution of modest statutory language that requires market-based solutions that employ needed risk reduction strategies while redeploying necessary capital to private startup business enterprises. This proposal thus benefits the middle class entrepreneurs, suppliers of capital, and job seekers harmed by the current regulatory regime, while permitting for an expansion of the U.S. and global economies.

Sanjay Kanti Das

Entrepreneurship on small scale is the only solution to the problems of unemployment and proper utilization of both human and non-human resources and improving the living conditions of the poor masses. The basic rationale of developing these industries are that they provide immediate large scale employment, ensure more equitable distribution of income, encourage decentralization of industries and eradicate poverty and unemployment. During the last three decades, many countries of the world have experienced the need and importance of entrepreneurship has been accepted as a strategy to achieve the twin objectives of promotion of entrepreneurship, particularly among the educated unemployed youth and also for rapid industrialization in the economy. The main object of this paper is to study the existing literature on entrepreneurship through Micro finance-SHG linkage in India in general and NER in particular. The analysis of this study is based on secondary sources. Efforts are also made in this paper to analyze the role of micro finance through SHGs in the promotion and development of entrepreneurship. This paper examines the different approaches of entrepreneurship and also explains the different key areas of micro enterprise development. Finally, this paper highlights the problems of micro, rural and women entrepreneurs and also suggested some specific measures based on the survey of existing literature, for the promotion of these industries in the country.

Darren Swanson, Stephan Barg, Stephen Tyler, Henry David Venema · 9 authors

No abstract is available for this record.

Jianfang Zhu

For the new socialist countryside constuction and creation of a harmonious society,it has become imminent stage through financial innovations to enable vulnerable groups in rural areas enjoy the equal credit opportunity as far as possible.However,there has been a blood loss mechanism in present rural financial system due to China's economic and financial development strategy in the long run.Meanwhile,the microloan,which truly serves the rural vulnerable groups,has not been developed and generalized due to various practical condition constraints.The three cases of peer-peer loans to rural abroad show that microloan to rural poor can be propelled and developed by decentralized social forces in the appropriate institutional arrangements,achieving win-win balance among lenders,rural poor borrowers,microloan institutions and P2P platform to find a new ways of supporting rural vulnerable groups by microloan.In the present with increasingly sophisticated network technologies the experience of peer-peer loans to rural can be copied and spread,so it may be an important way for rural vulnerable groups access to sustainable finance sevices.

Thorsten Beck, Asli Demirgüç‐Kunt, María Soledad Martínez Pería

Using data from a survey of 91 banks in
\n 45 countries, the authors characterize bank financing to
\n small and medium enterprises (SMEs) around the world. They
\n find that banks perceive the SME segment to be highly
\n profitable, but perceive macroeconomic instability in
\n developing countries and competition in developed countries
\n as the main obstacles. To serve SMEs banks have set up
\n dedicated departments and decentralized the sale of products
\n to the branches. However, loan approval, risk management,
\n and loan recovery functions remain centralized. Compared
\n with large firms, banks are less exposed to small
\n enterprises, charge them higher interest rates and fees, and
\n experience more non-performing loans from lending to them.
\n Although there are some differences in SMEs financing across
\n government, private, and foreign-owned banks - with the
\n latter being more likely to engage in arms-length lending -
\n the most significant differences are found between banks in
\n developed and developing countries. Banks in developing
\n countries tend to be less exposed to SMEs, provide a lower
\n share of investment loans, and charge higher fees and
\n interest rates. Overall, the evidence suggests that the
\n lending environment is more important than firm size or bank
\n ownership type in shaping bank financing to SMEs.

Ignacio Mas

Being able to make payments conveniently and securely is an essential ingredient in modern life and commerce. It enables economic livelihoods and supports many social relationships, communal support actions, and public welfare programs. Yet most people and micro enterprises in developing countries must rely on physical delivery of cash or actual goods to make payments. This imposes large costs and risks on those beyond the reach of modern payment networks. Access to payment facilities is a major enabler for achieving universal access to finance. In this paper the author further develop a broad vision for financial inclusion sketched out in Mas (2008), where payments can be easily made through an electronic network. What makes visioning such a payments utility possible is the technology author have today, which can be used to bridge distances, close information gaps, contain settlement risks, and generally reduce transaction costs. The author is confident that today's technology can do the job. Now the challenge is to develop attractive services that engage customers and workable business models that enable decentralized, largely private, and institutions to build this payments utility.

David R. Mason, Victoria A. Beard

In response to the growing critique of decentralized and participatory approaches to development, the article develops a theoretical framework for analyzing the relationship between community-based planning and poverty. Building on contributions from research on collective action, social capital, and social movements, the framework identifies a series of variables that are theorized to affect a community's capacity to alleviate poverty. Using this framework, three community-level case studies in Oaxaca, Mexico are analyzed. All three communities are characterized by a decline in subsistence agriculture, increasing out-migration, and the use of remittances to finance community-based planning projects. The article documents each community's capacity to alleviate the material manifestations of poverty. It concludes that only the community with the strongest capacity for community-level collective action was capable of planning independent of the state, and thus in a position to take incipient steps toward addressing poverty's structural causes. The findings call into question the often assumed desirability of collaborative planning and support the need for a more nuanced understanding of the strengths and limitations of distinct forms of community-based planning interpreted within broader socio-political contexts.

Nan Sun

Empirical analysis on the structure of financial institutions and economic growth in rural areas after China's reform and opening for 26 years shows that it is urgent to reform the financial institutions.The development of decentralization and diversification of rural finance cannot meet the requirements of promoting economic growth in rural areas.Agricultural socialized service system should take centralized system of Chinese rural financial system as the basic mode,including services for each stage before,during and after production.

Getaneh Gobezie

Microfinance opportunities have been successfully expanding in Ethiopia during the past fifteen years, including in remote villages, where the majority of people are engaged in smallscale agriculture, which is little supported by modern technology. Some of the key strategies for the success include: innovative adaptation of the group guarantee lending model, successfully customized to local Ethiopian realities; decentralization of operation, including a focus on using indigenous knowledge and resources in client screening and follow-up; appropriate strategies to deal with financing small scale (rain-fed) agriculture, often subject to season changes. However, much remains to be done. The outreach in micro-credit is estimated to have satisfied only a small proportion of the potential demand, while the growth of individual enterprises and the impact on clients' income remain low. It is becoming more and more challenging to further expand the micro-credit outreach, introduce inclusive finance to reach remote villages and very poor people, as well as ensure an impact on the lifestyle of clients. This is due, among other things, to poor infrastructure, particularly the road network and other communication channels, low level business support, as well as the 'entrepreneurship challenge'. This calls for a collaborative effort of all stakeholders in rural development. The present paper examines the opportunities and challenges faced while expanding access to microfinance to poor people in remote areas.

Patricia Clarke Annez, Gwénaelle Huet, George E. Peterson

This book takes a look at the past to gain insights for the future. Nearly 30 years ago, when the world urban population was only about half of the 3 billion that it is today, when most Less Developed Countries (LDCs) were primarily rural, and before the wave of decentralization of the 1980s and 1990s, the World Bank developed an instrument with great potential. The key characteristics of this instrument, the Urban Infrastructure Fund (UIF), are several. It provides finance for an array of urban services, not just one sector, such as water and sanitation, leaving flexibility for local beneficiaries to set their priorities. UIF projects operate in more than one city. Perhaps the most important distinctive feature is that these projects use local institutions to do the work of identifying, appraising and channeling finance to subnational entities (municipalities, local utilities, or community groups) on behalf of the World Bank. This arrangement makes it feasible to reach beyond the major capitals or business centers such as Chongqing, Mumbai, or Sao Paulo, or even regional capitals, to fund much smaller subprojects, suited to the needs and capacities of smaller cities and towns, because local agents are tasked with identifying and appraising these projects. Delegating these functions makes it practicable not only for a large International Financial Institution (IFI) such as the World Bank but also for national governments to reach small municipalities. Providing support to large numbers of municipalities with relatively small investment needs is a complex task, but it is fundamental to scaling up beyond small pilot projects to programs improving urban services countrywide.

Elmer S. Soriano, David M. Dror, Erwin Gaspar A. Alampay, Jolande

A sustainable health reinsurance system can be fashioned for the informal sector by mobilizing social and economic forces operating within individual communities. The economic analysis in part 1 of this book draws conclusions from success stories in industrial countries and failures in low- and medium-income countries. This analysis leads to the premise that decentralized development of microinsurance units, operating in a market segment left out by for-profit health insurance firms and by national schemes, can be stabilized financially through their affiliation with a reinsurance facility-Social Re' (part 1, this volume; Dror and Duru 2000, pp. 30-40; Dror 2001). Dror, Preker, and Jakab, in chapter 2 of this book, explain how the sociological dimension would theoretically affect the performance of a microinsurer. Findings of the Institute of Medicine reaffirm the active interplay of biology, psychology, behavior, and society in determining people's health attitudes. The institute further reports that, although people's attitudes and actions can readily be altered, these changes need support and reinforcement over time to guarantee better health. Attitudinal and behavioral changes are best prolonged through interventions at multiple levels, from the individual to society at large (Institute of Medicine 2001, pp. 1-1-1-8). Efforts are required to address the psychosocial factors that influence health status, including, for example, proposing measures such as microinsurance to persuade individuals to accept a healthy way of life and permanently modify their health behavior. Microinsurance schemes provide individuals, households, and communities mechanisms for financing their health through group risk-pooling mechanisms, leading to a sustained improvement in their access to health services. Higher up on the social scale, well-evaluated interventions at the organizational level should be encouraged, giving credit to organizations' vital role in influencing individual behavioL Still farther up the scale, community involvement in health-promotion strategies should not be overlooked, because some disease-related factors that are beyond an individual's capacity to modify can be significantly minimized through community efforts. Community empowerment, social support, and other values that protect members from stress are strengthened through community-level interventions. Finally, interventions at the societal level recognize the role of collective organizations influencing individuals' everyday existence (Institute of Medicine 2001, pp. 1-1-1-8). Underlying assumptions are that members' affiliation with microinsurers is voluntary (individuals can join, stay enrolled, or withdraw at will) and that microinsurers will voluntarily join Social Re. A clue is therefore needed about the considerations that shape individual and collective choices. According to one opinion, The underlying economic motivation for joining a microinsurance unit is assumed to be a desire to seek reciprocity in sustaining risk-sharing arrangements among essentially self-interested individuals (Dror and jacquier 1999, p. 79). This assumption implies that joining a microinsurance unit (and Social Re) is a predictable, rational economic choice by self-interested individuals to maximize total utility (optimal choice theory), and an act of reciprocity, in which giving and getting are somehow linked. According to the utility motive, people will join if they can benefit from joining. However, considering that many people will pay a health insurance premium without getting any cash benefits (if they stay healthy), is it really clear what each individual would consider as his or her exact utility from being insured? As Herrnstein points out, because utility cannot be directly observed, it must be inferred from behavior, from the choices individuals make. Thus, utility is synonymous with the modem concept of reinforcement in behavioral psychology (Herrnstein 1997, p. 226). Dror and Jacquier mention a second motive for joining a microinsurance unit: people's desire to improve their health by controlling their living and working conditions. This control is linked to a deep-rooted human need to seek voluntary and repeated interaction with others in daily life (Dror and Jacquier 1999, p. 80). These interactions may provide material reciprocity or they may reflect altruistic, nonmaterial interactions. The three authors mentioned above suggest that, to understand how microinsurers can attract and retain their clients, they have to know what shapes their clients' behavior in their specific operating context. The same reasoning applies to a microinsurer's decision to affiliate with Social Re. Since Social Re will be piloted in the Philippines, this examination will be done with reference to that country and culture. The rest of this chapter will provide an overview of the social and institutional structure of Philippine rural and informal society and the attitudes toward solidarity, risk, and insurance that influence choices and help shape the role of microinsurance. This role is quite different from what could be conjured from classical economic theory on utility, as will be shown. This analysis leads to the conclusion that in the rural Philippines, the introduction of insurance and reinsurance hinges as much, perhaps more, on the structure of society than on the profile of risks and the existence of a market for insurance.