Economist Muhammad Yunus and local villagers
Tags: community, economic sociology, organizations/occupations/work, global development, grameen bank, income, microcredit, microfinance, networks, poverty, social capital, women's autonomy, women's empowerment, 06 to 10 mins
Summary: This clip profiles the founding of the Grameen Bank by economist Muhammad Yunus and its development in rural Bangladesh. Both the bank and Yunus were awarded the Nobel Peace Prize in 2006 "for their efforts to create economic and social development from below." Specifically, the bank is known for microcredit, or giving relatively small, low interest loans to poor people who seek to create businesses. Yunus explains that the world's financial system effectively rejects two-thirds of the world population, but the concept of microcredit is innovative in that it allows such people to participate. The lending system is peculiar in that it requires no collateral, no legal contract, and 96% of the loans are made to women. Each week these loan recipients gather in a center meeting to pay their installments directly to a regional Grameen banker and to discuss shared challenges. While much has been written on the Grameen Bank as an institution which promotes social capital, women's empowerment, and the eradication of poverty, I think this clip is particularly useful for setting up a discussion of social capital. Social capital is often conceived of as a form of capital which inheres in social relations and enhances the ability of actors to draw upon the resources of neighborhood and community. Following Robert Putnam (2001), communities can even be described as having "stocks" of social capital. After watching this clip, students can be encouraged to discuss how such stocks of social capital might be increased through the introduction of microcredit. More than simply flooding a community with material "money" capital, the lending system provides a pretense for women to leave their homes, nurture friendships, and share resources with each other. Note that this video was made by Izzit, which is a company that produces a variety of educational videos.
Submitted By: Lester Andrist
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