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Credit markets with asymmetric information often prefer credit rationing as a profit maximizing device. This paper asks whether the presence of informal credit markets reduces the cost of credit rationing, that is, whether it can alleviate the impact of asymmetric information based on the...
Persistent link: https://www.econbiz.de/10005800242
This paper examines whether the presence of informal credit markets reduces the cost of credit rationing in terms of growth. In a dynamic general equilibrium framework, we assume that firms are heterogenous with different degrees of risk and households invest in human capital development. With...
Persistent link: https://www.econbiz.de/10005839008
In a dynamic general equilibrium framework with heterogeneous firms, this study analyzes the importance of informal credit markets in financial development and growth. By drawing instances from informal market we show that informal loans reduce the cost of credit constraints under regulated...
Persistent link: https://www.econbiz.de/10005078599
This paper examines whether the presence of informal credit markets reduces the cost of credit rationing in terms of growth. In a dynamic general equilibrium framework, we assume that firms are heterogenous with different degrees of risk and households invest in human capital development. With...
Persistent link: https://www.econbiz.de/10009430090
One way to measure the lower steady state equilibrium outcome in human capital development is the incidence of child labor in most of the developing countries. With the help of Indian household level data in an overlapping generation framework, we show that production loans under credit...
Persistent link: https://www.econbiz.de/10005838963
One way to measure the lower steady state equilibrium outcome in human capital development is the incidence of child labor in most of the developing countries. With the help of Indian household level data in an overlapping generation framework, we show that production loans under credit...
Persistent link: https://www.econbiz.de/10009430171
How does the punishment for default affect repayment behavior? We use administrative data provided by the leading Italian lender of unsecured credit to the household sector to investigate the effect of two potentially important factors: judicial efficiency and the availability of informal credit...
Persistent link: https://www.econbiz.de/10005802032
We model the economic incentives surrounding opium crop production in Afghanistan. Specifically, we examine the impact of eradication policies when opium is used as a means of obtaining credit, and when the crops are produced in sharecropping arrangements. The analysis suggests that when perfect...
Persistent link: https://www.econbiz.de/10009404585
We model the economic incentives surrounding opium crop production in Afghanistan. Specifically, we examine the impact of eradication policies when opium is used as a means of obtaining credit, and when the crops are produced in sharecropping arrangements. The analysis suggests that when perfect...
Persistent link: https://www.econbiz.de/10010330043
Persistent link: https://www.econbiz.de/10011809359