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We show that the joint liability lending contracts derived in <link rid="b4">Ghatak (2000)</link> violate an "ex post" incentive-compatibility constraint which says that the amount of joint liability cannot exceed the amount of individual liability. We derive and characterise optimal separating joint liability...
Persistent link: https://www.econbiz.de/10005072097
This note argues that the joint liability contracting equilibria worked out in Ghatak(2000) have a serious drawback in that, even though incentive compatible ex ante, they violate ex post rationality. For such contracts to be feasible, banks should be able to extract more under failure than...
Persistent link: https://www.econbiz.de/10011251313
Persistent link: https://www.econbiz.de/10007431089
This paper originates from the current move to individual-based lending systems by many microfinance institutions and the fear that this move will lead to a decrease in access to credit for the poor. More specifically, the paper examines how an individual-based lending scheme can be devised such...
Persistent link: https://www.econbiz.de/10012731022
It is now stylized that, while the impact of ownership on firm productivity is unclear, product market competition can be expected to have a positive impact on productivity, thereby making entry (or contestability of markets) desirable. Traditional research in the context of entry has explored...
Persistent link: https://www.econbiz.de/10009476875
Productivity growth has long been associated with, among others, contestability of markets which, in turn, is dependent on the ease with which potential competitors to the incumbent firms can enter the product market. There is a growing consensus that in emerging markets regulatory and...
Persistent link: https://www.econbiz.de/10005528126
Persistent link: https://www.econbiz.de/10005531876
Government’s land acquisition has come increasingly under fire from both the courts and the people whose lands are being acquired. This article argues that the way land is being acquired in India is contrary to the principles that govern a market-based society. It shows the close...
Persistent link: https://www.econbiz.de/10011139085
We offer new conceptual insights into the understanding of occupational choice in uncertain rural environments, with a focus on its ex ante &lpar;before a shock&rpar; and ex post &lpar;after a shock&rpar; consequences for farmers belonging to different portions of the asset distribution. We model theoretically the...
Persistent link: https://www.econbiz.de/10011099472
The contributors – top international scholars from finance, law and business – explore the role of governance, both internal and external, in explaining risk-taking and other aspects of the behavior of financial institutions. Additionally, they discuss market and policy features...
Persistent link: https://www.econbiz.de/10011181939