Is democracy a logical concomitant of microfinance? : a theoretical review of the microfinance argument

Abstract

This thesis makes a theoretical review of the microfinance argument, which claims that microfinance would be accompanied with democratization or consolidation of democracy. This thesis firstly analyzes the theory of modern microfinance, especially its propensity of converting borrowers into modern citizens. Secondly, this thesis analyzes five major theories supporting the microfinance argument: (a) modernization and economic development, (b) economic fairness, (c) gender justice, (d) social capital, and (e) civil society. In addition, this thesis reviews critical perspectives of these five theories and makes a general discussion. Finally, this thesis concludes the reasonableness and limitation of the microfinance argument.