The Credit Constraints of Market-Oriented Farmers in Chile

Alvaro Reyes and Robert Lensink

Journal of Development Studies, 2011, vol. 47, issue 12, 1851-1868

Abstract: Using data from two surveys conducted in 2006 and 2008 with 177 farmers, this article determines whether market-oriented farmers in central Chile are credit constrained, and it identifies the main factors that influence formal credit provision. In so doing, this study explicitly tests whether social capital variables play a role in determining credit constraints. That is, the authors explore the determinants of classifications into four categories of credit provision and rationing, using a panel multinomial logit model. The results suggest that most market-oriented farmers are unconstrained. Empirical evidence supports the importance of relationship variables for improving access to financial capital.

Date: 2011
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DOI: 10.1080/00220388.2011.579111

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