Credit in a Random Matching Model With Private Information

S. Rao Aiyagari and Stephen Williamson ()

Game Theory and Information from EconWPA

Abstract: We consider a random matching model without monetary exchange where agents have complete access to each others’ histories. Exchange is motivated by risk sharing given random unobservable incomes. There is capital accumulation and an endogenous interest rate. The key feature of this environment is that information is mobile across location even while goods are not. Optimal allocations in the dynamic private information resemble real-world credit arrangements in that there are credit balances, credit limits, and installment payments. The steady state has the property that there is a limiting distribution of expected utility entitlements with mobility and a positive fraction of agents who are credit constrained.

JEL-codes: C7 D8 (search for similar items in EconPapers)
Date: 1997-05-30
Note: Type of Document - ; prepared on IBM PC-Scientific Word ;
View list of references View citations in EconPapers

Downloads: (external link)
http://129.3.20.41/eps/game/papers/9705/9705005.ps.gz (application/postscript)
http://129.3.20.41/eps/game/papers/9705/9705005.pdf (application/pdf)

Related works:
Working Paper: Credit in a Random Matching Model with Private Information (1997)
Journal Article: Credit in a Random Matching Model with Private Information (1999)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpga:9705005

Access Statistics for this paper

More papers in Game Theory and Information from EconWPA
Series data maintained by EconWPA ().