Rationing Agricultural Credit in Developing Countries: The Role and Determinants of Transaction Costs for Borrowers

摘要: Transaction costs in financial intermediation are a measure of the 'friction' existing functioning markets. The higher intermediation, less efficient performance sector resource allocation and distribution. frequently increase as result regulations imposed on markets, such interest-rate restrictions selective credit policies. Financial intermediaries circumvent through non-price mechanisms that generate transaction for lenders borrowers, whereas policies usually carry built-in cost-increasing procedures requirements. In this paper we investigate role borrowing rationing mechanism agricultural markets five less-developed countries. We show become an effective device these further argue results practices regressive, despite intended distributional goals low-interest rate small-farmer allocations schemes. also main determinants costs, inverse relationship exists between level explicit interest charged loans magnitude costs. Our findings indicate both development banks private pass to borrowers implicit-pricing ration out undesired clients. Private generally more doing than and, at same time, responsive changes structure. first present summary discussion recent evidence levels degree regressiveness credit. next section deals with borne by farmer emphasising trade-off rates one hand, differences bank behaviour other hand. Major conclusions follow.