LEVERAGE DECISIONS IN THE PRESENCE OF BANKRUPTCY LAWS

Bruce Ahrendsen and Robert N. Collender

No 270695, 1989 Annual Meeting, July 30-August 2, Baton Rouge, Louisiana from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: Optimal leverage is modeled with and without the truncation of wealth provided by bankruptcy. Differences in optimal leverages and in farmers' responses to government programs are examined. Under plausible conditions some risk averse farmers demand infinite debt. Together farm programs and bankruptcy laws exacerbate agency problems in lending

Keywords: Agricultural and Food Policy; Farm Management; Financial Economics (search for similar items in EconPapers)
Pages: 14
Date: 1989-07-30
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Citations: View citations in EconPapers (1)

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Working Paper: LEVERAGE DECISIONS IN THE PRESENCE OF BANKRUPTCY LAWS (1989)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea89:270695

DOI: 10.22004/ag.econ.270695

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