STOCHASTIC DYNAMIC MODELING: AN AID TO AGRICULTURAL LENDER DECISION MAKING

Cole Gustafson

Western Journal of Agricultural Economics, 1989, vol. 14, issue 01, 9

Abstract: Factors affecting a lender's decision to grant farmers operating credit in North Dakota are quantified in an intertemporal loan profitability model using stochastic dynamic programming. Experimental data obtained from a panel of lenders demonstrates the sensitivity of an optimal policy to changes in a lender's discount rate, a borrower's repayment status, and patronage. The value of credit scoring models that appraise a borrower's credit worthiness also is determined.

Keywords: Agricultural; Finance (search for similar items in EconPapers)
Date: 1989
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:wjagec:32463

DOI: 10.22004/ag.econ.32463

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