Microeconomic Behavior of Agents in a Credit-Output Market in an Agricultural Setting

Geron, Maria Piedad S. Author_Email:

Philippine Journal of Development, 1989

Abstract: Rural agents engage in interlocking market transactions to minimize costs due to underdevelopment of rural markets. This study aims to model the economic behavior of agents in a credit-output market. Results indicate the prevalence of high interest rates in developed areas. Where income is low, transaction costs are high and the market is segmented, informal lenders are useful on efficiency grounds. Hence, the first-best solution appears to be augmenting farmer’s income.

Keywords: transaction costs; economic/development modelling; income; rural sector; credit market (search for similar items in EconPapers)
Date: 1989
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Persistent link: https://EconPapers.repec.org/RePEc:phd:pjdevt:jpd_1989_vol__xvi_no_1-a

DOI: 10.62986/pjd1989.16.1a

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