Consumer education is often considered an integral part of microinsurance schemes; a win-win solution that benefits both microinsurance practitioners and their clients. It is supposed to help low-income households make sound choices and practitioners stimulate demand. The current lack of...

Assuming a risk-neutral bank and assuming household utility to be exponential, we show how under information symmetry the covariance of income and loan repayments may explain higher household borrowings than in the case without default option. Under ex post information asymmetry and positive...