Microfinance and the care economy

The proposed paper will explore the linkages between micro-credit and unpaid care work by developing a two-sector model within the structuralist tradition as a first pass to addressing these questions. The objective is to uncover interlinkages between the informal sector based on micro-credit and the formal sector and highlight the implications of changing allocation to care work for the wider economy. Section 2 presents a brief overview of microfinance in developing countries with a specific focus on India. After clarifying our analytical framework in Section 3 we present a two-sector model in order to elucidate the relationship and interaction between the formal capitalist sector employing male workers and the informal, sector where female worker pursues self-employment opportunities through access to micro-finance (Section 4). The model investigates demand dynamics and the impact of an increase in interest rates on microfinance loans. Finally, we explore the interlinkage between care labor and productivity in Section 5.