The Costs and Returns of Agricultural Credit Delivery

Brent A. Gloy, Michael Gunderson and Eddy L. LaDue

American Journal of Agricultural Economics, 2005, vol. 87, issue 3, 703-716

Abstract: Borrower-level data from 963 agricultural lending relationships are used to examine how several factors influence the costs and returns of extending agricultural credit. The results provide estimates of the costs and returns of agricultural lending and the extent to which these costs and returns are influenced by factors such as loan volume, lender/borrower relationship factors, and contract terms. The findings indicate that economies of size exist in agricultural credit delivery and that lenders pass most of these benefits on to borrowers through lower interest rates. In addition, the impacts of lender/borrower relationship factors were relatively small. Copyright 2005, Oxford University Press.

Date: 2005
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Working Paper: The Costs and Returns of Agricultural Credit Delivery (2004)
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