Fairness and microcredit interest rates: from Rawlsian principles of justice to the distribution of the bargaining range
Business Ethics, the Environment and Responsibility 22 (3):277-291 (2013)
Abstract
This paper addresses the fairness of microcredit interest rates. Since microfinance institutions provide credit for the poor at relatively high prices, the fairness of their interest rates has been repeatedly debated. We first apply Rawls' principles of justice to the case of microcredit interest rates and suggest some limitations related to the hypothesis of rationality of the borrowers and the level of inequality. We then suggest another framework based on the analysis of the distribution of the benefits generated by the transaction to assess the fairness of interest rates. We conceptualize this as the distribution of the bargaining range between the borrowers' and the institutions' reservation price and discuss what these reservation prices could be in the context of microfinanceMy notes
Similar books and articles
The impact of tax policy on economic growth, income distribution, and allocation of taxes.James D. Gwartney & Robert A. Lawson - 2006 - Social Philosophy and Policy 23 (2):28-52.
Fairness in Technological Design.Cameron Shelley - 2012 - Science and Engineering Ethics 18 (4):663-680.
Conflicts of interest? The ethics of usury.Martin Lewison - 1999 - Journal of Business Ethics 22 (4):327 - 339.
Usury.Joakim Sandberg - 2013 - In Hugh LaFollette (ed.), The International Encyclopedia of Ethics. Wiley-Blackwell.
‘Fair benefits’ accounts of exploitation require a normative principle of fairness: Response to Gbadegesin and Wendler, and Emanuel et al.Angela Ballantyne - 2008 - Bioethics 22 (4):239–244.
Distributive Justice, Injustice and Beyond Justice: The Difference from Principle to Reality between Karl Marx and John Rawls.Wei Xiaopin - 2008 - Proceedings of the Xxii World Congress of Philosophy 50:857-872.
Well-being and fairness in the distribution of scarce health resources.Re'em Segev - 2005 - Journal of Medicine and Philosophy 30 (3):231 – 260.
Justice as Fairness: Luck Egalitarian, Not Rawlsian.Michael Otsuka - 2010 - The Journal of Ethics 14 (3-4):217-230.
Analytics
Added to PP
2013-05-14
Downloads
44 (#267,872)
6 months
2 (#300,644)
2013-05-14
Downloads
44 (#267,872)
6 months
2 (#300,644)
Historical graph of downloads
Citations of this work
The Ethical Crisis in Microfinance: Issues, Findings, and Implications.Marek Hudon & Joakim Sandberg - 2013 - Business Ethics Quarterly 23 (4):561-589.
The Just Price as the Price Obtainable in an Open Market.Juan M. Elegido - 2015 - Journal of Business Ethics 130 (3):557-572.
What is a Fair Level of Profit for Social Enterprise? Insights from Microfinance.Marek Hudon, Marc Labie & Patrick Reichert - 2020 - Journal of Business Ethics 162 (3):627-644.
From Credit Risk to Social Impact: On the Funding Determinants in Interest-Free Peer-to-Peer Lending.Gregor Dorfleitner, Eva-Maria Oswald & Rongxin Zhang - 2021 - Journal of Business Ethics 170 (2):375-400.
Ethical Complexity of Social Change: Negotiated Actions of a Social Enterprise.Babita Bhatt - 2022 - Journal of Business Ethics 177 (4):743-762.