Comparative Analysis of the Efficiency of Microfinance Institutions in Latin America

Abstract

The present work aims to evaluate the technical efficiency of microfinance institutions in Latin America using parametric and non-parametric methods. The stochastic frontier parametric model and the deterministic method of data envelope analysis were used. Likewise, a Tobit linear regression analysis was carried out to determine the determinants of inefficiencies in these institutions. The results show that it is possible to increase the average technical efficiency of the institutions and that the ownership structure and context variables, number of people hired, operating expenses, expenses in salaries and salaries, and the number of loans influence inefficiencies.

Keywords: Social banking, efficiency, property type, DEA, microfinance.