An Asian development bank : credit risk contingency and the subsidy dependence index

The authors offer an analysis of one financial institution, a government-operated bank in Thailand, the Bank for Agriculture and Agricultural Cooperatives (BAAC). This article ties the actual BAAC operating systems to the theory of an optimal allocation of risk bearing. The lessons they draw in this article are not peculiar to the BAAC and Thailand alone but apply more generally to institutions in other emerging market economies and in industrialized, developed economies such as the U.S. (DSE/DÜI)