Chapter

Some Aspects of Linked Product and Credit Market Contracts Among Risk‐Neutral Agents

Clive Bell and T. N. Srinivasan

in The Economic Theory of Agrarian Institutions

Published in print December 1991 | ISBN: 9780198287629
Published online November 2003 | e-ISBN: 9780191595912 | DOI: http://dx.doi.org/10.1093/0198287623.003.0011

Series: Clarendon Paperbacks

 Some Aspects of Linked Product and Credit Market Contracts Among Risk‐Neutral Agents

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The authors explore, in a principal‐agent model of interlinking of production credit and crop marketing, the terms of equilibrium contracts under risk neutrality; in particular, they examine the situation in which one of the two relevant instruments—the rate of commission on crop sale and the rate of interest on credit—is redundant.

Keywords: credit; equilibrium contracts; interest rate; marketing; moral hazard; production credit; rate of commission; risk neutrality; risk‐sharing

Chapter.  9175 words. 

Subjects: Economic Development and Growth

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