Paper

From Fragmentation to Embeddedness: Towards a Framework for the Institutional Analysis of Financial Markets

A proposed framework to better understand the financial markets in Kenya
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This paper seeks to develop a framework for understanding local financial markets through an institutional analysis of the financial intermediaries involved.

The paper proposes that:

  • Financial intermediation can be seen as a collective action problem to which there are three core types of solutions - firms, the state and co-operative or mutually based organizations;
  • Each type can be analyzed as an institution in which there are rules and monitoring and enforcement mechanisms;
  • Such an analysis demonstrates the ways in which these mechanisms are related to wider sets of institutions - legal, political, social, cultural and economic.

Having set out this conceptual framework, the paper goes on to show its relevance to understanding the essential features of financial intermediaries in Karatina in Kenya.

About this Publication

By Johnson, S.
Published