The joint liability literature claims that positive assortative matching, or risk homogeneity, is always the first best solution. We examine this claim in presence of group formation costs and find that the assertion is not always true

The success of joint liability programs depends on nature and composition of borrowing groups. Group formation is a costly process and in our model these costs vary with the social identity of group partners. We show that risk heterogeneity in a borrowing group may arise due to the social...

The joint liability literature claims that positive assortative matching, or risk homogeneity, is always the first best solution. We examine this claim in presence of group formation costs and find that the assertion is not always true

Misunderstanding of the structure of microcredit interest rates remains a rich source of generating criticism against the industry high interest rates. Research has focused its attention on the cost structure of interest rates and recently on the macroeconomic and macro-institutional factors....

Outbreaks of infectious diseases bring behavior and policy responses into sharp focus since societies face acute constraints and uncertainties. This paper compares two infectious disease outbreaks: the COVID-19 pandemic and the 1665 London plague outbreak described by Daniel Defoe in A Journal...

We study the effects of a randomized role models intervention in which female engineering students gave presentations at high schools about their experiences in the major. Among girls, we find an increased preference for engineering majors for those in the top math ability quartile; with stronger...

The success of joint liability programs depends on nature and composition of borrowing groups. Group formation is a costly process and in our model these costs vary with the social identity of group partners. We show that risk heterogeneity in a borrowing group may arise due to the social...

In cooperative games with transferable utilities, the Shapley value is an extreme case of marginalism while the Equal Division rule is an extreme case of egalitarianism. The Shapley value does not assign anything to the non-productive players and the Equal Division rule does not concern itself...

We consider an incomplete information network game in which agents’ information is restricted only to the identity of their immediate neighbors. Agents form beliefs about the adjacency pattern of others and play a linear-quadratic effort game to maximize interim payoffs. We establish the...