Untangling the role of diverse social dimensions in the diffusion of microfinance

TL;DR

This study explores how different social relationship types influence microfinance adoption in rural India, revealing that trust-based connections are most influential in spreading microfinance participation.

Contribution

The paper introduces a new measure called diffusion versatility and demonstrates its effectiveness in predicting microfinance adoption over traditional measures.

Findings

Trust-based social layers are most influential in microfinance diffusion.

Diffusion versatility outperforms existing centrality measures in prediction.

Nodes central in trust layers significantly impact microfinance spread.

Abstract

Ties between individuals on a social network can represent different dimensions of interactions, and the spreading of information and innovations on these networks could potentially be driven by some dimensions more than by others. In this paper we investigate this issue by studying the diffusion of microfinance within rural India villages and accounting for the whole multilayer structure of the underlying social networks. We define a new measure of node centrality, diffusion versatility, and show that this is a better predictor of microfinance participation rate than previously introduced measures defined on aggregated single-layer social networks. Moreover, we untangle the role played by each social dimension and find that the most prominent role is played by the nodes that are central on layers concerned with trust, shedding new light on the key triggers of the diffusion of microfinance.