On the trade-off between size, sustainability and social outcome of the microfinance institutions : a two stages bootstrapped dea approach

Abstract EN

he paper aims at measuring the performance of MFIs in MENA region with reference to all the MFIs around the world.

The efficiency scores are derived using the nonparametric Data Envelopment Analysis (DEA) technique in order to calculate both Pure Technical Efficiency and Scale Efficiency.

Bootstrapping is used in order to correct the Efficiency scores from their bias and to retrieve the correct inference when it comes to perform the second stage estimation.

Data used are a non-balanced panel of 1179 MFIs from 103 countries covering the period from 2006 to 2012.

The main aim of taking all the operating MFIs, for which, data are available is to produce a sound benchmark and evaluate the real performance of the MFIs in the MENA region compared to the rest of the world.

In a second stage, a double censored multilevel regression is performed to assess the determinants of scale efficiency in the MFIs.

The results show, among others, that financial performances enhance the possibility to operate under the optimal scale weather the MFI is too small or too big while social performances are reached more by too large MFIs.