Simon Cornée, Marc Jegers, Ariane Szafarz

Feasible Institutions of Social Finance: A Taxonomy

Volume 178 () / Issue 3, pp. 280-310 (31)
Published 01.07.2022

31,00 € including VAT
article PDF
This paper unpacks the continuum of social finance institutions (SFIs), ranging from foundations offering pure grants to social banks supplying soft loans. The in-between category includes quasi-foundations granting loans requiring partial repayment. In our model, SFIs maximize their social contribution arising from financing successful social projects, under a budget constraint dictated by their funders. We determine the feasibility of each SFI category. Quasi-foundations appear to be efficient and adapted to low market rates. However, reciprocity from SFI borrowers can elicit a so-called hold-up effect, whereby the SFI charges a high interest rate to its loyal clients.

Simon Cornée No current data available.

Marc Jegers No current data available.

Ariane Szafarz No current data available.