The Role of Microfinance in Improving Global Economy

Author

Khamphou Milayome

Date of Award

8-2025

Degree Type

Doctoral Dissertation

Degree Name

Doctor of Business Administration (DBA)

Department

Jack Welch College of Business & Technology

Comments

Submitted as partial fulfillment of the requirements for the degree of Doctor of Business Administration in Finance Sacred Heart University, Jack Welch College of Business and Technology, Sacred Heart University

DISSERTATION Number DBA07/2025

Dissertation Supervisor

Dr. Mahfuja Malik

Committee Member

Dr. Shuang Wu

Committee Member

Dr. Khawaja Mamun

Abstract

This study investigates microfinance’s role in enhancing the global economy by examining its impact on economic growth, unemployment, and political stability. Secondary data from MIX Market and WDI were used in this study to assess these relationships. Multiple regression was conducted with EViews software to test regression models with the independent variables related to microfinance and microfinance institutions (MFIs). Using the data from South Asia and Southeast Asian countries, this study finds that microfinance significantly improves economic growth, reduces the unemployment rate, and strengthens political stability. Microeconomic variables used in the study are borrowing amounts and the cost per borrower. MFIs’ performance is measured by MFIs’ returns on assets, loan loss rate, and operational self-sufficiency ratio. Multiple regression analyses also control for other MFI-related and macroeconomic factors. While microfinance has strong impacts on economic growth and political stability, the impacts of MFIs’ performance are mixed on these variables. These findings highlight the importance of tailoring microfinance strategies to maximize economic benefits and contribute to sustainable development within diverse economic contexts.

JEL Classification

G21; O16; O44:

Recommended Citation

Milayome, K. (2025). The role of microfinance in improving global economy. Jack Welch College of Business & Technology dissertation, Sacred Heart University, Fairfield CT. Retrieved from https://digitalcommons.sacredheart.edu/wcob_theses/50/

Creative Commons License

This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.