Banking competition, good or bad? The case of promoting micro and small enterprise finance in Kazakhstan

Dorothea Schaefer (1) , Boriss Siliverstovs (2) , Eva Terberger (3)

1 DIW Berlin
2 DIW Berlin
3 Ruprecht-Karls-Universitaet

Competition is claimed to be beneficial in development projects promoting micro and small enterprise finance although there are still doubts as to whether these loans can be developed into a profitable business. Our research sheds new light on the question of how many MSE banking units should optimally be created and supported in a certain region. We employ a unique data set from the European Bank for Reconstruction and Development for Kazakhstan, and investigate which strategy contributes more to the overall success of the program: a strategy of setting up several competing banks or a strategy of establishing regional monopolies.

Mots clés: Social Sciences & Humanities

Dorothea Schaefer, Boriss Siliverstovs, Eva Terberger. Banking competition, good or bad? The case of promoting micro and small enterprise finance in Kazakhstan. Applied Economics, 2010, 42 (06), pp.701-716. ⟨10.1080/00036840701720820⟩. ⟨hal-00582061⟩