BORROWING BEHAVIOR OF THE PROPRIETARY FIRM: DO SOME RISK-AVERSE EXPECTED UTILITY MAXIMIZERS PLUNGE?

Robert A. Collins and Edward E. Gbur

Western Journal of Agricultural Economics, 1991, vol. 16, issue 2, 8

Abstract: When a proprietor's liability is limited, borrowing behavior for an expected utility maximizer may vary widely. Proprietors with little to lose may rationally choose very large debt levels while others may choose to finance with 100% equity. This article presents a theory to explain these widely observed variations in behavior.

Keywords: Financial; Economics (search for similar items in EconPapers)
Date: 1991
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:wjagec:32606

DOI: 10.22004/ag.econ.32606

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