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dc.contributor.authorObebo, Forah M.
dc.contributor.authorWawire, Nelson H.W.
dc.contributor.authorMuniu, Joseph M.
dc.date.accessioned2019-05-29T12:33:56Z
dc.date.available2019-05-29T12:33:56Z
dc.date.issued2018-06-05
dc.identifier.citationInternational Journal of Economics and Finance; Vol. 10, No. 7; 2018en_US
dc.identifier.issn1916-971X
dc.identifier.urihttp://ir-library.ku.ac.ke/handle/123456789/19476
dc.descriptionResearch Articleen_US
dc.description.abstractThe development of the microfinance sub-sector in Kenya is seen as a favourable catalyst for increasing performance of Micro and Small Enterprises (MSEs). Despite the development, MSEs continue to suffer from high levels of financial exclusion and shortage of operating funds. This scenarios raise policy questions on whether participation in microfinance has effects on performance of MSEs. While past studies on this relationship have demonstrated that the effects are mixed, an understanding of the effects on participation of microfinance on different segments on MSEs -especially the youth and women owned businesses and age of businesses, is necessary in designing relevant policy changes in the MSE subsector. To address this, the study used the 2016 FinAccess Dataset and estimated these effects using the propensity score matching technique. This model was considered suitable since it accounted for potential endogeneity biases associated with self-selection into participation, unobserved entrepreneurial abilities and risk taking behaviour of MSEs. Apart from showing that participation in microfinance has positive effects on performance of MSEs, the study has demonstrated that there is presence of constraints limiting the impact of microfinance especially in firms owned by the youth and women. As such, there is need for policy and product designs to address these hindrances even as participation in microfinance is encouraged. Based on the results, it is recommended that government and microfinance providers should design policies and products that increase firm participation in microfinance. This may be through scaling up financial literacy programmes and encouraging acquisition of permits. Finally, policy should address obstacles that hinder the youth and women owned MSEs from benefiting from microfinance.en_US
dc.language.isoenen_US
dc.publisherCanadian Center of Science and Educationen_US
dc.subjectMicro and small enterprisesen_US
dc.subjectMicrofinanceen_US
dc.subjectPropensity score matchingen_US
dc.subjectProbiten_US
dc.subjectEndogeneityen_US
dc.titleEffects of participation of micro and small enterprises in microfinance on their performance in Kenyaen_US
dc.typeArticleen_US


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