Since their inception in the 1970s, microfinance institutions (MFIs) have received increasing attention both from policymakers and academic circles. Using unbalanced panel data (2000–2017) from Ethiopia, in this paper, we investigated the performance of MFIs and its determinants on the one hand and whether or not mission drift exists on the other hand. To this end, we employed seemingly unrelated regression (SUR) and fixed/random effect panel models. The results indicate that, based on different outreach and financial performance metrics, the MFIs in Ethiopia have good performance compared with those of the 10 biggest economies in Sub-Saharan Africa (SSA). The econometric estimation results show that asset holding and the yield on gross portfolio have a positive and significant effect on the social and financial performances of MFIs in Ethiopia. Furthermore, the number of loan officers, loan officer productivity, and personnel productivity have a positive and significant impact on the financial performance of MFIs. Our results also suggest that the null hypothesis—that MFIs are not shifting away from poorer clients—cannot be rejected, implying that there is no mission drift by MFIs in Ethiopia.

This study analyzed the determinants of rural households’ food security in the Kallu district of the Amhara region, Northern Ethiopia. The study used primary data collected from 395 randomly selected rural households. The study employed descriptive statistics and a binary logit model to estimate the status and determinants of smallholders’ food security, respectively. Of the total sample households, 47.30% are food insecure. The binary logit model results showed that sex and education level of the household head, livestock ownership, credit access, and technology adoption have positive and significant effects on food security, while age and market distance are negatively associated with the probability to be food secure. The results suggest that improving access to marketing and financial services will contribute to improving the food security status of smallholders.

Purpose Using a recent rural farm household survey, the purpose of this paper is to investigate inclusiveness and effectiveness of agricultural cooperatives in Ethiopia. Design/methodology/approach The study employs a logit model to examine inclusiveness and an endogenous switching regression (ESR) model to evaluate the effectiveness of agricultural cooperatives. Findings The results show that agricultural cooperatives are less inclusive of land-poor and illiterate households. On the other hand, the estimated results indicate that cooperatives effectively improved agricultural performance and welfare of its member households – i.e. membership in cooperatives increases yield and income by 1.37 quintal/hectare and 1,804 birr, respectively. Moreover, the result shows that marketing cooperatives effectively increased marketed surplus of their members by 34 percent. Research limitations/implications The study has important implications regarding the ways to improve the effectiveness and/or inclusiveness of agricultural cooperatives. Originality/value While accounting for the collective behavior of cooperatives, this study uses multiple outcome variables in examining the effectiveness of cooperatives in Ethiopia. Furthermore, this paper employs the ESR model and accounts for potential problems in estimating impact using non-experimental data.

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