women leaders and social performance evidence from financial cooperatives in senegal how do women leaders such as board members and top managers influence the social performance of organizations this paper addresses the question by exploiting a unique database from a senegalese network of 36 financial cooperatives we scrutinize the loan granting decisions made jointly by the locally elected board and the top manager assigned by the central union of the network our findings are threefold first female dominated boards favor social orientation second female managers tend to align their strategy with local boards preferences third the central union tends to assign male managers to female dominated boards probably to curb the boards social orientation

discrimination against women in formal credit markets reality or rhetoric abstract microenterprises receive several forms of aid but many still report limited access to formal finance it is often argued that women entrepreneurs face discrimination in formal credit markets in this study of ecuadorian microenterprises the results of a multinomial logit model show that although a smaller number of women than men entrepreneurs applied for loans a larger percentage of women than men typically apply for loans the equally small probabilities of both male and female entrepreneurs being quantity rationed for loans implies that this form of credit rationing is not widely practiced in special microenterprise programs in ecuador

are poor people credit constrained or myopic evidence from a south african panel credit constraints are an almost ubiquitous assumption in development economics yet direct evidence for credit constraints is limited and many observations consistent with credit constraints are equally compatible with myopic non forward looking consumption or precautionary saving using household panel data and a source of widely anticipated income in south africa this paper tests and rejects the standard consumption model with perfect capital markets then myopic consumption and precautionary saving are tested as alternative explanations for the observed jumps in expenditure the standard model with credit constraints cannot be rejected in favour of myopic consumption or precautionary saving

an empirical investigation of rationing constraints in rural credit markets in india abstract the literature on rural credit markets has generally assumed that households are rationed in their access to subsidized formal credit the validity of this assumption depends on the level of effective demand for formal credit in turn a function of the demand for credit and its availability from informal sources this paper estimates the demand and the sector specific costs of credit and hence the extent of formal sector rationing through an analysis of household participation in both the formal and the informal credit sectors the results show that the extent of rationing is considerably less than what is conventionally assumed

coordinating regime switches the canonical model of strategic complementarities between individual actions which exhibits multiple equilibria under perfect information is extended with heterogeneous agents and imperfect information agents observe their own cost of action and the history of the levels of aggregate activity the distribution of individual characteristics evolves through a random process and individuals are rational bayesians under plausible conditions there is a unique equilibrium with phases of high and low activity and random switches applications may be found in macroeconomics and revolutions

a rudimentary random matching model with divisible money and prices abstract we consider a version of kiyotaki and wright s monetary search model in which agents can hold arbitrary amounts of divisible money a continuum of stationary equilibria indexed by the aggregate real money stock exists with all trading occurring at a single price there is always a maximum level of the real money stock consistent with existence of such an equilibrium in the limit as trading becomes faster relative to discounting any real money stock becomes feasible in such an equilibrium in contrast to the original kiyotaki wright model higher equilibrium real money stocks unambiguously correspond to higher welfare in this costless production environment journal of economic literature classification numbers d51 e40

income distribution transaction costs and market fragmentation in informal credit markets in an environment characterized by inequitable wealth distribution and limited market infrastructural institutions the trust component of credit transactions is founded on personal relations through these information and transaction costs advantages are provided but also control and unequal bargaining power can be exercised in the informal sector transaction and information costs will lead to non price closure in credit markets while behavioral differences in lenders will lead to manipulation of prices as well as of quantities the quantity closure rules are modeled and tested for two types of informal lenders in the agricultural sector of the philippines the trader lenders and the farmer lenders it is found that the two groups of lenders systematically sort their borrowers and ration credit copyright 1992 by oxford university press

financial market efficiency in an agrarian economy microeconometric analysis of the pakistani punjab the shadow price of capital in production is a useful indicator of the efficacy of the rural financial system using data on participants and non participants in a small farm credit programme from the pakistani punjab this article estimates the shadow price of capital endogenous switching regressions techniques are employed to control for the likely heterogeneity of borrowers versus non borrowers results indicate that an individual selected at random from the population of small farmers would experience a 200 per cent rate of return on the first rupee borrowed from the small farm credit programme indicating a high shadow price of capital and a prima facie case for small farm credit programmes

rural financial markets in low income countries recent controversies and lessons abstract recently some researchers have criticized traditional agricultural credit policies in low income countries this article identifies the major points of controversy between traditional views and these new views and also summarizes the primary lessons learned from these controversies savings mobilization more flexible interest rate policies less loan targeting and greater emphasis on improving the quality of financial services in rural areas are new views that are emphasized

a paradox of thrift in general equilibrium without forward markets after 2008 the us personal saving rate had its strongest postwar jump from 2 to 5 and the investment ratio its sharpest fall from its postwar average of 16 to its lowest level of 12 the coordination of saving and investment is analyzed here in a theoretical model of general equilibrium with rational expectations and no forward market shocks affect preferences for future consumption a paradox of thrift is proven that formalizes an argument in the general theory of keynes but the equilibrium is a constrained pareto optimum textbook fiscal policies are neutral at best or inefficient

state credit programs and the peasantry under populist regimes lessons from the apra experience in the peruvian amazon abstract a study near iquitos peru finds that a national agricultural program implemented in the late 1980s which provided peasants with access to credit secure land tenure and grassroots organization promised to reduce rather than improve the welfare of intended beneficiaries new economic conditions and strategic behaviors engendered by the program threatened to combine through a process of community enclosure and competitive exclusion to undermine the subsistence viability of peasant communities general lessons are drawn for more effective rural development programs ones that pay particular attention to direct and indirect feedback effects of macroeconomic policy the factors that limit peasant economic competitiveness and to the fundamental spatiality of development processes

when demand creates its own supply saving traps the mechanism by which aggregate supply creates the income that generates its matching demand called say s law may not work in a general equilibrium with decentralized markets and savings in bonds or money full employment is an equilibrium but convergence to that state is slow a self fullling precautionary motive

wealth and volatility we document that in the us over the course of the past century there has been a systematic negative relation between household wealth and business cycle volatility we develop a microfounded dynamic equilibrium model that contains elements of a traditional keynesian framework in which economic uctuations can be driven by sunspot type uctuations in household optimism or pessimism the novel feature is that the scope for equilibrium uctuations due to sunspots depends on the exogenously given value of household wealth when wealth is high consumers demand is not sensitive to unemployment expectations and the economy is robust to condence crisis when wealth is low consumers demand is sensitive to unemployment expectations the economy becomes vulnerable to condence driven uctuations and is in general more volatile in this case there is a potential role for public policies to stabilize demand we conclude by providing micro economic evidence on the importance of wealth in aecting the sensitivity of demand to aggregate conditions we show that during the great recession consumers with low

credit constraints credit unions and small scale producers in guatemala abstract efficient and equitable development outcomes may depend in part on whether formal financial institutions leave low wealth producers tightly constrained in their access to credit if so can cooperative institutions efficiently relax these constraints these issues are explored using survey data gathered from 950 small scale producer households in areas of guatemala with market oriented credit unions that mobilize savings and make unsubsidized loans nonprice rationing by banks is found to be common among lower wealth households while credit unions relax credit constraints for a significant portion of those rationed by banks but not the poorest of the study households

an analysis of offer functions of banks and credit unions in guatemala economists have sought to identify institutions which might fill the gap in household access to credit arising from rationing by formal lenders credit unions have been identified as institutions which might use informational and monitoring advantages to fill that gap using information on household perceptions of their access to credit this article analyses the impact of certain credit unions on the access to credit of households in guatemala regression results indicate that credit unions serve markets unserved by formal lenders and that information on household perceptions of their access to credit is important in making inferences about lender lending activities

commodity price stabilization in imperfect or cartelized markets most studies of commodity price stabilization assume that all agents behave competitively however many commodities suitable for stockpiling are produced by countries with a significant share of the world market and commodity agreements themselves often result in cartelization of the market the paper explores the consequences of market power for the choice of storage rule and the degree of price stabilization it finds that with linear demand dominant producers choose more stable prices than under perfect competition and price stability increases with their market share with constant elastic demand the competitive degree of price stabilization is achieved

access to capital and agrarian production organisation there are two problems both universal that entrepreneurs in any economy must contend with firstly an agent generally has access only to a limited amount of working capital secondly workers hired by an agent are subject to moral hazard and this necessitates their supervision this paper models for an agrarian economy the constraints imposed on entrepreneurs activities by these two problems and endogenously determines the various organisational forms of production as well as the allocation of resources that will obtain with a simple model we endeavour to explain a diverse set of empirical observations pertaining to the less developed countries in terms of the general processes that determine the distribution of income among the various agents and the hierarchical relationships that develop among them agricultural production typically involves a period of several months between the time the inputs are purchased and the time the output is marketed access to working capital and hence to the credit market thus plays an important role in a farmer s production decisions the distribution of access to credit in turn tends to be an important determinant of income distribution in poor agrarian economies credit is invariably rationed according to the ability to offer collateral the amount of working capital a farmer can mobilise therefore depends on the amount of land he owns which is often a good proxy for his overall wealth and thus his ability to offer collateral further since hired hands have a propensity to shirk they need to be supervised and therefore the

credit market access and profitability in tunisian agriculture this work develops an econometric model that links credit access with agricultural profitability and investment using data collected from rural tunisia this work provides direct estimates of credit access and its effects econometric estimates are run for agricultural investment and profitability as a function of credit access the investigation of credit access and its effect suggests that the presence of credit market constraints does impinge significantly on farm profitability but not on investments

liquidity and trading dynamics in this paper we build a model where the presence of liquidity constraints tends to magnify the economy s response to aggregate shocks we consider a decentralized model of trade where agents may use money or credit to buy goods when agents do not have access to credit and the real value of money balances is low agents are more likely to be liquidity constrained this makes them more concerned about their short term earning prospects when making their consumption decisions and about their short term spending opportunities when making their production decisions this generates a coordination element in spending and production which leads to greater aggregate volatility and greater comovement across producers

risk wealth and sectoral choice in rural credit markets we model the role of the informal credit sector in developing countries the informational advantage of informal lenders is portrayed as the ability to monitor borrowers monitoring reduces the incentive problem and allows for contracts with lower collateral this enables informal lenders to serve both individuals who cannot post the collateral required by the formal sector and those who are able but do not want to post collateral the model is consistent with the conventional view of the informal sector as recipient of spillover demand from the formal sector it also shows that the informal sector may provide partial insurance as the lower collateral requirement implies greater consumption smoothing for borrowers

dynamic monetary equilibrium in a random matching economy this article concerns an infinite horizon economy where trade must occur pairwise using a double auction mechanism and where fiat money overcomes lack of double coincidence of wants traders are anonymous and lack market power goods are divisible and perishable and are consumed at every date preferences are defined by utility stream overtaking money is divisible and not subject to inventory constraints the evolution of individual and economywide money holdings distributions is characterized there is a welfare ordered continuum of single price equilibria reflecting indeterminacy of the price level rather than of relative prices

agro export production and peasant land access examining the dynamic between adoption and accumulation abstract new technologies and export opportunities have often contributed to dualistic agrarian structure and intense social conflict in latin american a switching regression model developed in this paper explicitly links export adoption and land accumulation patterns controlling for pre existing differentiation processes applied to survey data gathered from peasant households in guatemala the model provides evidence of equitable structural change induced by a recent export boom in vegetable crops however the optimism of these results is tempered by consideration of the unfavorable longer term market dynamics confronting small scale producers

credit constraints and agricultural productivity evidence from rural rwanda while potentially negative impacts of credit constraints on economic development have long been discussed conceptually empirical evidence for africa remains limited we use a direct elicitation approach on a national sample of rwandan rural households to empirically assess the extent and nature of credit rationing in the semi formal sector and its impact using an endogenous switching model elimination of all constraints could increase output by some 17 per cent implications for policy and research are spelled out

three perspectives on sustainable food security efficiency demand restraint food system transformation what role for life cycle assessment achieving food system sustainability is a global priority but there are different views on how it might be achieved broadly three perspectives are emerging defined here as efficiency oriented demand restraint and food system transformation these reflect different conceptualisations on what is practically achievable and what is desirable underpinned by different values and ideologies about the role of technology our relationship with nature and fundamentally what is meant by a good life this paper describes these emerging perspectives and explores their underlying values highlights lca s role in shaping these perspectives and considers how lca could be oriented to clarify thinking and advance policy relevant knowledge it argues that more work is needed to understand the values underlying different approaches to the food sustainability problem this can shed light on why stakeholders disagree where there are genuine misunderstandings and where common ground is possible and ways forward agreed

rural financial markets in developing countries their use and abuse until recently the use of agricultural credit as a developmental tool seemed clear and straightforward most concerned people believed that increases in the volume of cheap credit were necessary to boost agricultural production and that the rural poor could be brought into the mainstream of development through supervised credit programs it seemed that certain ideal types of rural credit institutions offered the promise of meeting farmers credit needs and that experience in the industrialized countries with cooperatives and specialized agricultural finance institutions could be effectively transplanted to low income countries this collection of readings highlights facets of rural financial markets that have often been neglected in discussions of agricultural credit in developing countries it moves beyond a narrow concern with the simple provision of credit to a broad consideration of the performance of rural financial markets and of ways to improve the quality and range of financial services for low income farmers it reflects new thinking on the design administration evaluation and policy framework of rural finance and credit programs in developing countries

segmentation collateral undervaluation and the rate of interest in agrarian credit markets some evidence from two villages in south india this paper examines certain issues pertaining to the structure of agrarian credit markets in developing countries using empirical evidence on credit transactions from two villages in south india first the bases for the segmentation between formal and informal sectors of the credit market are identified as being 1 the type of collateral offered on credit contracts and 2 the purpose for which credit is taken secondly the paper shows the occurrence of a systematic association between rates of interest and types of collateral the evidence supports the hypothesis that lower marketability of collateral security and hence higher undervaluation increases the rate of interest charged on a loan thirdly the evidence shows an inverse relationship between the value of land owned by a borrower and the rate of interest on a credit contract copyright 1991 by oxford university press

the relationship between credit and productivity in chinese agriculture a microeconomic model of disequilibrium credit is an important element in agricultural production systems it allows producers to satisfy the cash needs induced by the production cycle which characterizes agriculture preparation planting cultivation and harvesting of the crops are typically done over a period of several months in which very little cash revenue is earned while expenditures on materials purchased inputs and consumption must be made in cash cash income is received a short time after the harvest in the absence of credit markets farmers would have to maintain cash reserves so as to facilitate production and consumption in the next cycle the availability of credit allows both greater consumption and greater purchased input use and thus increases welfare of the farmers

on financial innovations and credit market evolution abstract this paper examines the role of financial innovations in the economic development process it discusses the place of policy intervention in the financial development of developing countries and through a case study of an innovative bank illustrates the nature and characteristics of the financial innovations necessary for financing small enterprises and mobilizing resources from low and middle income groups such financial innovations are shown to reduce transaction costs and risk and as a result to bring about widening deeping and intergration of capital markets this process accelerates economic development through a favorable impact on savings investment and output

implicit interest rates usury and isolation in backward agriculture the unusually high interest rates in many backward agricultural regions have been a source of some puzzlement to economists adding to this puzzle is the fact that these rates can take on a wide range of values often within the same region one important question is why arbitrage between sectors does not lead to more homogeneous and lower interest rates the traditional answer to this is in terms of lender s risk it is argued that moneylenders in backward regions face a great risk of default and once this is taken into account the effective interest rate turns out to be no higher than its counterpart in the organised sector consequently there is no real room for arbitrage and the high interest rates are equilibrium prices while this explanation may be of use in some situations it is in general inadequate and can even be misleading the reason which novelists describing rural india have repeatedly written about is that in these financial transactions the lender s risk frequently ranges from minimal to non existent because the personalised relation between the borrower and the lender enables the latter to extract the defaulted loan in the form of asset transfers from the borrower in a somewhat stylised manner these deals could be thought of as follows a peasant takes a loan from his employer keeping some of his assets like land a standing crop or even the promise of labour services as security or collateral a collateral price is then fixed this is the conversion price used to calculate the amount of collateral that has to be relinquished to the lender given a certain amount of default clearly the lower the collateral price the larger the quantity of collateral that the peasant has to forfeit hence the underpricing of collateral amounts to the charging of an implicit interest a widespread feature of rural credit markets reported in many diverse studies bardhan and rudra 1978 myint 1964 raj 1981 roth 1979 and sivakumar 1978 to mention just a few is the underpricing of collateral an interesting attempt to bring collateral explicitly into a model of usury was made by bhaduri 1977 see also 1983 who argued that one of the reasons why landlords raise interest rates is in fact to encourage default and to claim ownership of the asset kept as collateral a sharp contrast to the lender s risk model this hypothesis has deservedly received much attention 1

a unified framework for monetary theory and policy analysis search theoretic models of monetary exchange are based on explicit descriptions of the frictions that make money essential however tractable versions of these models typically make strong assumptions that render them ill suited for monetary policy analysis we propose a new framework based on explicit micro foundations within which macro policy can be studied the framework is analytically tractable and easily quantifiable we calibrate the model to standard observations and use it to measure the cost of inflation we find that going from 10 percent to 0 percent inflation is worth between 3 and 5 percent of consumption much higher than previous estimates

risk rationing and wealth effects in credit markets theory and implications for agricultural development we develop a model that shows that asymmetric information can result in two types of credit rationing conventional quantity rationing and risk rationing whereby farmers are able to borrow but only under high collateral contracts that offer them lower expected well being than a safe subsistence activity after exploring its incidence with respect to wealth we show that risk rationing has important policy implications specifically land titling will be only partially effective because it does not enhance producers willingness to offer up the collateral needed to secure loans under moral hazard constraints efforts to enhance agricultural investment and the working of agricultural credit markets must step beyond land titling and also deal with risk copyright 2008 oxford university press

reconciling hayek s and keynes views of recessions recessions often happen after periods of rapid accumulation of houses consumer durables and business capital this observation has led some economists most notably friedrich hayek to conclude that recessions often reflect periods of needed liquidation resulting from past over investment according to the main proponents of this view government spending or any other form of aggregate demand policy should not be used to mitigate such a liquidation process as doing so would simply result in a needed adjustment being postponed in contrast ever since the work of keynes many economists have viewed recessions as periods of deficient demand that should be countered by activist fiscal policy in this paper we reexamine the liquidation perspective of recessions in a setup where prices are flexible but where not all trades are coordinated by centralized markets the model illustrates why liquidations likely cause recessions characterized by deficient aggregate demand and accordingly suggests that keynes and hayek s views of recessions may be closely linked in our framework interventions aimed at stimulating aggregate demand face a trade off whereby current stimulus postpones the adjustment process and therefore prolongs the recessions but where some stimulative policies may nevertheless remain desirable

dynamic coordination and the optimal stimulus policies this article studies stimulus policies in a simple macroeconomic model featuring a dynamic coordination problem that arises from demand externalities and fixed costs of investment in times of low economic activity firms face low demand and hence have lower incentives for investing which reinforces their low demand expectations in a benchmark case with no shocks the economy might get trapped in a low output regime and a social planner would be particularly keen to incentivise investment at times of low economic activity however this result vanishes once shocks are considered

rural credit markets and institutions in developing countries lessons for policy analysis from practice and modern theory this article presents evidence of the failure of government intervention in rural credit markets of ldcs in the past three decades it then shows how lessons for policy analysis can be drawn from modern theory particularly those theories focussing on credit rationing in competitive markets and interlinking of credit contracts with labor and land contracts the article outlines the policy implications of these theories and finds them insufficient to account for the empirical evidence it contends that a more systematic and rigorous analysis of institutions and institutional environments is essential for understanding and implementing effective policy reforms of rural credit markets it presents suggestions for undertaking such an analysis

microenterprise lending to female entrepreneurs sacrificing economic growth for poverty alleviation abstract this research compares the performance of female and male entrepreneurs in a microenterprise credit program in guatemala previous research and field practice has suggested that targeting credit at female borrowers allows for greater increases in household welfare but that male entrepreneurs may more aggressively expand enterprises when given access to credit in this paper we develop a model that shows that increases in value of home time during childbearing years for women may substantially account for gender differences in responses to credit access empirical results from guatemalan survey data yield estimations consistent with the predictions from our model

understanding the coexistence of formal and informal credit markets in piura peru summary this paper examines why farm households seek informal loans in piura peru where formal lenders offer loans at lower interest rates a panel data econometric analysis reveals that the informal sector serves various types of clients households excluded from the formal sector but also households that prefer informal loans because of lower transaction costs or lower risk an in depth examination of contract terms and loan technologies permits an accurate comparison of effective loan costs and contractual risk across sectors and reveals that proximity and economies of scope enjoyed by informal lenders enable them to substitute information intensive screening and monitoring for contractual risk and supply these various types of clients

equilibrium credit rationing of small farm agriculture it is often argued that externally imposed contractual restrictions lead to inequitable credit rationing this paper argues that unrestricted laissez faire markets may also inequitably ration credit a formal model which grants borrowers autonomy in credit application and use demonstrates that adverse incentive and selection effects may cause banks to endogenously impose interest rate restrictions and ration small farms out of the credit market consequently liberalization of financial markets may be insufficient to guarantee small farms access to credit

moving forward looking back the impact of migration and remittances on assets consumption and credit constraints in the rural philippines abstract this paper investigates the impact of migration and remittances on asset holdings consumption expenditures and credit constraint status of households in origin communities using a unique longitudinal data set from bukidnon philippines taking into account the endogeneity of the number of migrants and remittances received a larger number of migrant children reduces the values of nonland assets and total expenditures per adult equivalent however remittances have a positive impact on housing consumer durables nonland assets total expenditures per adult equivalent and educational expenditures enabling asset accumulation and investment in human capital neither migration nor remittances affects current credit constraint status