Microfinance and Human Development in Kerala

This paper examines how microfinance institutions impact human development indicators using the case of Kerala in southern India. The study uses an institutional approach to understand microfinance institutions with the help of three variables - core activities, total loan portfolio and approach to microfinance. The impact of microfinance institutions on four human development variables namely education, health, income and participation are analyzed. The main conclusion of the study is that microfinance institutions that follow an integrated approach impact human development more than those that follow a minimalist approach. Furthermore, this impact of microfinance institution is due to production functions that generate income and protective function that defends against vulnerability. Therefore, an integrated approach to microfinance has income generating and risk mitigating effects that translate into better human development indicators

Digital Platforms as (Dis)Enablers of Urban Co-Production: Evidence From Bengaluru, India

This article examines how digital platforms focused on citizen engagement affect urban transformation based on multiple case studies from Bengaluru, India. The research question is: What type of initiatives and designs of digital citizen platforms enable co-production? Co-production is defined as the use of assets and resources between the public sector and citizens to produce better outcomes and improve the efficiency of urban services. The study uses qualitative and quantitative approaches. Evaluative metrics of citizen engagement in digital platforms are done at two levels: platform metrics and initiative metrics. Each platform is evaluated under several variables that indicate the type of ownership, period of operation, aims and types of initiatives, and impact and levels of engagement. Then, the digital platforms are mapped for the extent of digital co-production that matches the type of digital interaction with a form of citizen-government relationship. The findings indicate that the orientation of digital co-production, where it exists, seems to be around the dimensions of co-testing and co-evaluation rather than co-design and co-financing. Furthermore, the digital platforms under study primarily view citizens as users rather than collaborators, limiting the scope of digital co-production. The involvement of urban local governments and private partners in a single platform strengthens the degree of citizen engagement, including the scope for co-production. Finally, there is a strong offline counterpart to citizen engagement through digital platforms where true co-production exists

Behavioural Finance: Beginnings and Applications

The essay traces the beginning of behavioural finance by examining the development of expected utility model. Expected utility model is based on the assumptions of time consistent preferences of utility. However, experimental results in psychology regarding choice under risk and uncertainty shows well-defined deviations from the predictions of expected utility model. It was found that there were systematic biases and heuristics that economic decision makers use to make choices. In the next section, the essay describes some of these heuristics and how they modify the assumptions of utility model. Applications of behavioural understanding in finance is briefly discussed to show the widespread prevalence of behavioural heuristics in and beyond finance. The essay concludes by arguing that accommodating the behavioural variable is necessary to make neoclassical model more relevant to the real world

Measuring Corporate Social Responsibility in India: A Composite Indicator Model

This paper proposes a composite indicator model called CSR index to measure corporate social responsibility practices of Indian companies. The proposed CSR index comprises three dimensions of CSR implementation, stakeholder management and sustainability, which are measured using 39 indicators. Data is collected from annual reports and business responsibility reports for top 100 companies ranked according to market capitalisation in March 2019. The final ranking using the CSR index highlights how Indian companies perform in their CSR practices beyond the legally mandated expenditure recommended by the Companies Act 2013. Robustness analysis shows that the ranking is robust with respect to input factors, data selection and data transformation. Regression modelling of select dimension scores of CSR index with exogenous variables of firm performance such as internal complaint resolution, turnover and profit shows positive correlation. The CSR index helps managers and policy makers to channelize a given company’s efforts at CSR into targeted programmes through resource allocation and monitoring, whilst comparing its relative performance within and across dimensions and industries

Behavioural Finance: Beginnings and Applications

The essay traces the beginning of behavioural finance by examining the development of expected utility model. Expected utility model is based on the assumptions of time consistent preferences of utility. However, experimental results in psychology regarding choice under risk and uncertainty shows well-defined deviations from the predictions of expected utility model. It was found that there were systematic biases and heuristics that economic decision makers use to make choices. In the next section, the essay describes some of these heuristics and how they modify the assumptions of utility model. Applications of behavioural understanding in finance is briefly discussed to show the widespread prevalence of behavioural heuristics in and beyond finance. The essay concludes by arguing that accommodating the behavioural variable is necessary to make neoclassical model more relevant to the real world

Initial conditions and cross-country macroeconomic impact during Covid-19

The objective of this study is to analyse the correlation between initial conditions and cross-country macroeconomic impact of Covid-19 on OECD economies. The study uses group-wise multivariate linear regression modelling to examine the link between macroeconomic variables of interest and the duration of the pandemic, severity of its impact, and annual investment growth rate. The main result from the study shows that variables related to debt such as domestic credit to private sector, private sector debt and debt-to-GDP ratio had significant relationship with the duration and severity of the crisis as well as the investment growth rate during Covid-19. The original contribution of the study is in bringing out the correlation between initial conditions and first order effects of the pandemic on the economy. The policy implications of the results indicate short, medium and long-term measures required to mitigate the systematic risk posed by the pandemic

The Origin and Nature of Behavioural Development Economics

The article traces the origin of behavioural development economics and brings out the characteristics of this framework in public policy

The Curious Case of Choice Architect: Examining the Philosophical Inconsistencies of Libertarian Paternalism

Classical economics works on the principle that individuals are rational and make decisions to maximize their self interest. However in real situations, individuals face a conflict between rational and irrational selves leading to decision making that does not leave them better off. Libertarian paternalism proposes a solution to this rationality problem in an individual by conceiving a choice architect. Choice architect is a third party capable of arriving at what a perfectly rational choice would be and ‘nudges’ an individual towards making that choice. Libertarian paternalists claim that choice architect does not interfere with the freedom of an individual because the choices he offers are easily reversible, i.e, an individual can reject it at any given point in time. Libertarian Paternalism seems to offer the third way between absolute autonomy of individual choice (libertarianism) and third party intervention (paternalism). This paper argues that the conception of a choice architect comes out of a hasty commitment to reconciling libertarianism and paternalism by placing perfect rationality and autonomy in two separate individuals in the case of a single decision making process. The paper proposes alternatives to confront the rationality problem

Towards good practice guidelines for the contour method of residual stress measurement

Accurate measurement of residual stress in metallic components using the contour method relies on the achievement of a good quality cut, on the appropriate measurement of the deformed cut surface and on the robust analysis of the measured data. There is currently no published standard or code of practice for the contour method. As a first step towards such a standard, this study draws on research investigations addressing the three main steps in the method: how best to cut the specimens; how to measure the deformation contour of the cut surface; and how to analyse the data. Good practice guidance is provided throughout the text accompanied by more detailed observations and advice tabulated in Appendi