Joint liability lending: a note

Shubhashis Gangopadhyay and Robert Lensink

No 01E09, Research Report from University of Groningen, Research Institute SOM (Systems, Organisations and Management)

Abstract: This note argues that the joint liability contracting equilibria worked out in Ghatak(2000) have a serious drawback in that, even though incentive compatible ex ante, they violate ex post rationality. For such contracts to be feasible, banks should be able to extract more under failure than under success. However, when we alllow for this, it may help explain some important empirical observations on joint liability lending.

Date: 2001
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://irs.ub.rug.nl/ppn/218034598 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 403 Forbidden (http://irs.ub.rug.nl/ppn/218034598 [302 Found]--> https://irs.ub.rug.nl/ppn/218034598 [302 Found]--> https://www.rug.nl/research/portal/publications/pub(becb081e-5262-4ab5-b881-c8fb5998c3c4).html [301 Moved Permanently]--> https://research.rug.nl/en/publications/pub(becb081e-5262-4ab5-b881-c8fb5998c3c4).html [301 Moved Permanently]--> https://research.rug.nl/en/publications/joint-liability-lending-a-note-2)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gro:rugsom:01e09

Access Statistics for this paper

More papers in Research Report from University of Groningen, Research Institute SOM (Systems, Organisations and Management) Contact information at EDIRC.
Bibliographic data for series maintained by Hanneke Tamling ().