The Underside of Microfinance: Performance Indicators and Informal Debt in Cambodia

Microfinance is a dominant strategy used to promote rural development around the world. Rather than directly track its impact on borrowers, however, microfinance institutions rely on indicators of financial performance adopted from commercial banking as proxies for positive social impact. Yet, as critical research has shown, the industry depends on coercive peer pressure, social shaming and various forms of gendered exploitation to achieve its high rates of loan repayment. This article maintains that there is a need to investigate how the microfinance industry's own indicators of impact contribute to the ways microfinance can harm borrowers. Based on qualitative research in Cambodia during 2021 and 2022, the article demonstrates how financial performance indicators, most notably portfolio quality, both hide and exacerbate the ways that borrowers juggle debt between formal and informal lenders. In making this argument, the article advances critical scholarship on microfinance by showing how microfinance repayment structures debt-juggling practices in ways that put borrowers at greater risk of over-indebtedness. As a result, the microfinance industry is able to claim that it successfully helps to alleviate poverty, even as it accumulates profits by appropriating wealth from poor and low-income households across the global South.     

Understanding Local Leadership in Building the Capacity of Rural Communities in Australia

Current approaches to rural community development in Australia provide for limited government intervention. Such intervention is usually housed within programmes that seek to build the internal capacity of communities to achieve long term socio‐economic sustainability. A fundamental implementation strategy for capacity building has been developing local leadership. The underlying assumption of this approach is that good leadership will result in existing resources being mobilised for a more sustainable function and new resources attracted. What though is good leadership in terms of building the capacity of rural communities to develop sustainable socio‐economic futures? This paper compares the conceptualisation of leadership within rural development policies and leadership training programmes with the nature of local leadership as it exists in on‐ground community building projects. From an in‐depth review of the role and nature of local leadership within six Australian rural communities it was found that local leadership could result in improved adaptive capacity if the leadership is similar in nature to Burn's (1978 ) transformational model of leadership. Within policy, local leadership was most often conceptualised as being similar to this transformational model. However, rural leadership training programmes tended to conceptualise leadership as a top‐down process, similar to Burn's (1978 ) transactional model. While this study of leadership within rural communities revealed that transactional skills, as taught in leadership training programmes, were important for successful project management, such skills did not necessarily result in improved community adaptive capacity. It is suggested that, while transactional leadership can have an important role in influencing the development of rural communities, greater attention needs to be given to developing strategies to support transformational leadership.     

Tackling the Down Side: Social Capital,Women’s Empowerment and Micro‐Finance in Cameroon

Micro‐finance programmes are currently dominated by the ‘financial self‐sustainability paradigm’ where women’s participation in groups is promoted as a key means of increasing financial sustainability while at the same time assumed to automatically empower them. This article examines the experience of seven micro‐finance programmes in Cameroon. The evidence indicates that micro‐finance programmes which build social capital can indeed make a significant contribution to women’s empowerment. However, serious questions need to be asked about what sorts of norms, networks and associations are to be promoted, in whose interests, and how they can best contribute to empowerment, particularly for the poorest women. Where the complexities of power relations and inequality are ignored, reliance on social capital as a mechanism for reducing programme costs may undermine programme aims not only of empowerment but also of financial sustainability and poverty targeting.     

The Neoliberal Seduction: Governing‐at‐a‐Distance,Community Development and the Battle over Financial Services Provision in Australia

This paper is concerned with understanding the reasons for the apparent success of neoliberalism: why the model of the ‘entrepreneurial, self‐reliant community’ has been adopted so widely and readily across Australia. It does this through an analysis of two events in the restructuring of financial services provision in regional Australia during the 1990s and 2000s: the John Laws/Australian Bankers’ Association ‘cash for comment’ affair, and the rise of ‘alternative’ financial service providers in the wake of the major trading banks’ financial service withdrawal programmes of the 1990s. This analysis is conducted using the conceptual toolkit of the governmentality literature. In this context, the paper explores the notion of translation — how authorities, agencies, etc., exert control over distant entities, whether these entities be branch staff or a far‐flung consumer market. In examining the often fragile character of ‘governing‐at‐a‐distance’ in modern forms of rule, it is argued that some recent advances in the ‘geography of power’ have much to offer in highlighting both the important roles played by space and scale in the execution of power in its various guises and the ways in which resistance to the more regressive features of neoliberal philosophy and policy may best focus.     

Debt‐Bonded Brick Kiln Workers and Their Intent to Return: Towards a Labour Geography of Smallholder Farming Persistence in Cambodia

Despite the increasing preponderance of non‐farm work in Cambodia, labour migrants across a range of working conditions remain linked to their rural homesteads through durable financial and social arrangements. This article explores this phenomenon through the case of debt‐bonded brick kiln workers in Phnom Penh, formerly smallholder farmers in villages. Drawing on the field of labour geography, the article first examines the process by which labourers became debt‐bonded, thus situating them within the country’s broader agrarian transition and recasting peasants as rural labour. It then explores workers’ perceptions of rural life, suggesting that the unfreedom of kiln work, contrasted with the fixedness and potential for mobility in rural life, makes workers aspire to return to their land. The article ultimately highlights how the persistence of smallholder farmers can be understood as an issue of poor work under neoliberalism in Cambodia, and draws light on the agency of labour in understanding this.     

Women and Money: Lessons from Senegal

This article examines the complexity and diversity of women's informal financial practices using data from surveys conducted in Senegal. It suggests that these practices are at the centre of a constant dialectic between short‐term and long‐term horizons, between the requirements of daily survival and the demands of community solidarity, and between personal aspirations and collective constraints. These practices also clearly illustrate a desire among the women in Senegal to impose a form of financial self‐discipline, and to create situations that will oblige them to earn income. The socio‐economic diversity among these entrepreneurs is also underscored. Informal financial arrangements are both a product and producer of gender inequalities and inequalities among women, as reflected in the research. This has direct policy implications, especially for microfinance products. If they are to be effective, microfinance services must develop beyond a standard, one‐size fits all model and become more innovative and adaptable to the diverse demands of women. They must be combined with complementary measures that challenge the systemic causes of inequality. Microfinance programmes should draw on informal financial arrangements while challenging their tendency to perpetuate inequality.     

Global Liquidity,the Private Sector and Debt Sustainability in Sub‐Saharan Africa

This article analyses the effect of changes in international financial markets on the debt dynamics in sub‐Saharan Africa in recent years. A key development is the rise of the private sector as both a lender and a borrower in African debt markets, a process that is associated with the growing integration of the region into global financial markets. The article argues that the Debt Sustainability Framework of the International Monetary Fund and World Bank has taken some steps to account for this growth of private sector, cross‐border debt, but such steps still fall short of what is needed. A full appreciation of the importance of private debt implies, first, that debt sustainability in sub‐Saharan Africa be understood in the context of countries’ integration in global financial markets and the global liquidity cycles that characterize those markets and, second, that the interplay between private and public debt be monitored in order to provide a fuller picture of the impact of private sector debt on fiscal sustainability.     

The Hidden Consequences of Credit: An Illustration from Rural Indonesia

Interest in rural financial development has been booming, but often with a blind eye to the broader consequences. Very few studies have tackled the unintended economic, social and ecological outcomes of ordinary indebtedness, the inevitable other side of credit. This article explores some of the main ‘hidden’ side‐effects of credit/debt relations, with special reference to the Indonesian plantation sector. I argue that widespread credit/debt relations are not only an important factor behind capital, land and labour control; they also generate constraints that foster market discipline and contribute to undermine traditional community bonds as well as environmental conditions. More generally, credit/debt relations represent a powerful mechanism of social selection that has, in the long run, crucially shaped the trajectory of capitalism at the household, firm and government levels.     

American home: Predatory mortgage capital and neighbourhood spaces of race and class exploitation in the United States

Predatory home mortgage lending has become a central concern for housing research, public policy and community activism in US cities. Regulatory attempts to stop abuses, however, are undermined by claims that ‘predatory’ cannot be defined or distinguished from legitimate subprime lending, and claims that the industry performs a public service by meeting the needs of low‐income, high‐risk consumers (many of them racially marginalized) who would have been denied credit in previous years. We evaluate these claims in historical‐geographical context, drawing on David Harvey's theory of class‐monopoly rent to analyse what is new (and what is not) in contemporary financial exploitation. We use a mixed‐methods approach to (1) provide econometric measures of subprime racial targeting and disparate impact that cannot be blamed on the supposed deficiencies of borrowers, (2) qualitatively assess the rationale for judging particular subprime practices and lenders as predatory, and (3) trace the connections between local practices and transnational investment networks. The fight against predatory lending cannot succeed, we argue, without a renewed analytical and strategic emphasis on the class dimensions of financial exploitation and racial‐geographical discrimination.     

Financial Exclusion in Rural and Remote New South Wales,Australia: a Geography of Bank Branch Rationalisation, 1981–98

The provision of financial services in rural Australia is a significant public policy issue, reflected in the high level of media and political interest in the recent spate of branch closures. There are, however, many aspects of the current debate regarding the delivery of financial services to rural communities that are, at best, less than ideal and, at worst, erroneous. Using telephone directories for New South Wales, non‐metropolitan bank branch listings for the period 1981 to 1998 were collated. A recategorisation of these data according to the Rural, Remote and Metropolitan Areas classification reveals, amidst a spatial realignment of financial service provision, that rural and remote New South Wales have been disproportionately affected by a relatively recent and concerted withdrawal of services. The research demonstrates that corporate‐level responses to increased competition within the financial system are significantly more important in deciding rural access to banking services than local and regional population trends. Indeed, two‐thirds of rural localities that have lost branches had experienced healthy population growth during the study period. In the wake of the post‐deregulation reconfiguration of the bank branch network, the socio‐economic marginalisation of rural communities is being compounded, a process of ‘financial exclusion’ recognised in other parts of the developed world.     

Out of the dark but not out of the cage: women's empowerment and gender relations in the Dangme West district of Ghana

In Ghana, strategies to address poverty among rural women have often been linked to women's empowerment programmes with credit as a core component of these. Yet, many programmes focus on the economic benefit to women without necessarily looking at the impact on gender relations at the household level and its implications on women. Using quantitative and qualitative data from the Dangme West district of Ghana, this article shows how poverty reduction programmes with credit components can reduce women's vulnerability to poverty and empower them. But much more needs to be done to complement these efforts. The study shows that women beneficiaries as against women non-beneficiaries have significantly improved their socio-economic status through access to financial and non-financial resources. This has in certain instances improved gender relations at the household level, with women being recognized as earners of income and contributors to household budget. However, some women still regard their spouses as ‘heads’ and require their consent in decisions even in issues that have to do with their own personal lives. Moreover, the improved economic status of women has resulted in a ‘power conflict’, creating confrontation between spouses. The article recommends that, as part of their programmes, assisting organizations and institutions must address ‘power relations’, the basis of gender subordination at the household level, otherwise socio-cultural norms and practices, underpinned by patriarchal structures, will remain ‘cages’ for rural women.     

Urban Unemployment and Migrants in Africa: Evidence from Harare 1985–1994

Unemployment is a major problem in urban centres in sub‐Saharan Africa. The impact of policies associated with structural adjustment programmes has frequently meant major formal job losses in both the public and private sectors. Although it is widely recognized that there has been a major (further) shift into the informal sector, it is also often claimed that ‘unemployment’ rates have greatly increased. When it is also assumed that net rural–urban migration has continued at a rapid pace, this is believed to be a significant contributor to the rise in unemployment. However, because ‘unemployment’ and ‘underemployment’ are hard to measure and to keep discrete when studying urban Africa, it is apparent that there is much confusion over current levels and trends in unemployment. This article discusses the problems of analysing African urban unemployment, drawing in particular on a recent ILO report, and presents evidence from long‐term research on migrants in Harare which casts doubt on the extent to which net in‐migration is a major factor contributing to unemployment in contemporary, economically adjusting sub‐Saharan Africa.     

A Grassroots Developmental Strategy for Africa: Towns as Agents of Growth Through Financial Credit

Since independence, governmental leaders in Africa have not pursued the policy option of making towns, represented as incorporated units, borrowers of commercial credit. To improve the quality of life among rural populations, governments in Africa should pursue the development strategy of making financial credit available to the towns located in those communities, because there is a high distribution of managerial expertise and material resources among the population. This article considers how African governments may adopt a development strategy that will encourage towns to borrow financial credit to engage in various economic and social activities, just like private companies. If these activities become viable, they may be a useful start in reversing the deterioration in economic and social well-being that several rural communities in Africa have suffered.     

Rural Rickets: Vitamin D Deficiency in a Post‐Medieval Farming Community from the Netherlands

Rickets is caused by vitamin D deficiency as a result of limited exposure to sunlight and inadequate diet. In the 19^th century, rickets was endemic in most northern European cities. In post‐Medieval Netherlands, rickets is documented in low frequencies in a few urban samples, but has not been studied in contemporaneous rural populations. Beemster is a rural farming community in the Netherlands that was established in the 17^th century upon drained land, with the Middenbeemster cemetery in use until 1866 AD. Ninety‐five individuals from the ages of 32 weeks in utero to 15 years were examined for rickets in order to understand factors that can cause vitamin D deficiency in rural, non‐industrialized populations. To identify rickets in the Beemster sample, ten features were scored, with bending deformities of the lower limb and one other feature, or at least three non‐bending features, having to be present in order for diagnosis. Nine individuals (9.5%) had evidence of rickets—a high prevalence, especially for a rural community where ample sunlight was available. The two and three year old Beemster infants were most heavily affected with an age‐specific prevalence of 30.4%. Two three‐month‐old infants also had rickets. Some of the affected may have developed rickets secondarily, as a result of a different illness, but cultural practices including prolonged swaddling, occlusive clothing, and keeping the young indoors, are suggested to have contributed to this high rickets prevalence. Dietary variables including poor weaning foods and common episodes of malnutrition may have also contributed to vitamin D deficiency. This study demonstrates the value of careful analysis of pathological conditions in subadults and highlights that rickets was not only a disease of cities, but affected populations that would appear to have been at low risk, because of maladaptive cultural practices. Copyright © 2013 John Wiley & Sons, Ltd.     

Precarious Debt: Microfinance Subjects and Intergenerational Dependency in Cambodia

This paper tells a story of debt within a rural Cambodian family in order to understand how microfinance produces more‐than‐individual financial subjects that are entangled in changing social relations of dependency. We draw upon 20 months of joint ethnographic research in Cambodia, where the microfinance industry is one of the largest per capita in the world. Informed by Judith Butler's notions of precariousness and precarity, we argue that even in the context of deepening financialisation, people's lives remain dependent upon others, especially within families. We analyse how these family relations of dependency are reworked along generational lines and spatially stretched due to precarious economic conditions of indebtedness, household migration, and distant labour markets. We conclude that reframing financial subjectivity in terms of precariousness helps us to analyse the relationship between households and financial markets, as well as inform a critical politics of finance.     

‘They shut them out the road’: Migration,mental health and the Scottish highlands

There is a small literature tackling migration and mental health, but less is said about the migration of people with mental health problems (incipient or diagnosed). The present paper considers what might be claimed about such migration, particularly when entailing movement into rural and remote areas where lack of anonymity, high social visibility and certain differences in how ‘locals’ and ‘incomers’ are treated may have serious consequences for those displaying psychological and behavioural differences. Drawing upon qualitative evidence from in‐depth interviewing of in‐migrants with mental health problems living in the Scottish Highlands, light is thrown on the connections between their problems and the decision to relocate to this predominantly rural region. Attention also focuses on dissonances between expectations regarding their new situation and their actual experiences of it in terms of both natural landscapes and, more importantly here, social milieux. There are further implications for changing regional attitudes towards mental health, suggesting certain impacts that arise not just from the in‐migration of people themselves who have mental health problems, but also from the ideas and practices that they often carry with them.     

Biros,Books and Big‐men: Literacy and the Transformation of Leadership in Simbu,Papua New Guinea

This article examines local strategies used to build leadership roles and enlist public support in a newly literate Papua New Guinean highlands rural community. The ethnographic evidence presented shows how the relationship between literacy and local ideas about modernisation and development has facilitated a shift in patterns of local political structures. When literacy is viewed as an unequally distributed and novel resource with inherently modernist connotations it becomes evident why male villagers in a contemporary highlands village endeavour to acquire and exploit it in rivalry with others. And while individual villagers market their reading and writing proficiency as a means to bolster their reputations within the existing socio‐political system, this has significance for traditional leadership and authority patterns, given that village leaders have traditionally been unschooled and therefore do not possess these highly regarded skills. To illustrate these processes I examine the political careers of two prominent villagers with particular attention to their respective claims to head two competing village‐based development projects. An analysis of the agendas they use to legitimate their authority roles in these projects makes clear how the quest to be seen to be literate has become a constitutive component of a prospective leader's repertoire of skills.     

Financial Inclusion or Subordination? The Monetary Politics of Debt in Cambodia

Financial inclusion is a leading driver of household debt across the global South. Although critical geographers have analysed this debt through the lens of financialisation, few have examined it in terms of monetary politics. This is a salient issue, because poorer nations often have limited control over their monetary policy due to their dependence on foreign currencies, which can adversely affect the structure of their financial markets. Building on the concept of monetary dependency from scholarship on financial subordination, I analyse the monetary politics of debt in Cambodia. Drawing on elite interviews and ethnographic research, I argue that Cambodia's extreme monetary dependence on the US dollar has shaped monetary and fiscal policies that compel poorer households to take on private debt to pay for their basic needs. This paper advances critical geographies of debt and development by studying financial subordination and its impact on financial inclusion in the global South.     

Grabbing Land for Equitable Development? Reengineering Land Dispossession through Securitising Land Development Rights in Chongqing

This article examines the securitisation of land development rights under the dipiao scheme in Chongqing, China. It argues that this instrument is based on the dispossession and exploitation of rural households but these unequal relations have been concealed and naturalised through the complex geographies and temporalities of dispossessory arrangements, financing mechanisms and discursive tactics. By overcoming political barriers to land commodification and dispossession in this way, the Chongqing government has expanded the frontier of commodifiable land and sustained a land‐based, urban‐centric and debt‐financed accumulation. Instead of narrowing the urban–rural divide, this instrument reproduces and solidifies it. On this basis, the article argues that conceptual and political innovations for inclusive and equitable development needs to shift the attention from land to people.     

RURAL–URBAN MIGRATION AND UNEMPLOYMENT: THEORY AND POLICY IMPLICATIONS*

ABSTRACT We develop a regional model where, in the city, unemployment prevails because of too high (efficiency) wages, while, in the rural area, workers are paid at their marginal productivity. We characterize the steady‐state equilibrium and show that it is unique. We then consider two policies: decreasing urban unemployment benefits and subsidizing urban employment. We find that decreasing the unemployment benefit in the city creates urban jobs and reduces rural–urban migration since new migrants have to spend some time unemployed before they can find a job in the city. On the other hand, raising employment subsidies increases urban employment but may also increase urban unemployment because it triggers more rural–urban migration. In this respect, the employment subsidy policy can backfire by raising rather than reducing urban unemployment.