2011-02-05 papers

on Microfinance

Issue of 2011‒02‒05
two papers chosen by
Aastha Pudasainee and Olivier Dagnelie

Signaling Credit-Worthiness: Land Titles, Banking Practices and Access to Formal Credit in Indonesia By Paul Dower; Elizabeth Potamites
Microcrédito com moral hazard By Rodrigo Peñaloza; Raquel Filgueiras

Signaling Credit-Worthiness: Land Titles, Banking Practices and Access to Formal Credit in Indonesia

By:	Paul Dower (New Economic School and the Center for Economic and Financial Research); Elizabeth Potamites
Abstract:	Many land titling programs have produced lackluster results in terms of achieving access to credit for the poor. This may re ect insucient empha- sis on local banking practices. Bankers commonly use sophisticated methods other than collateral to ensure repayment. Some methods rely on ex-ante in- formation ows and formal land titles can improve these ows by signaling to the bank important characteristics about borrowers. Using a household survey from Indonesia, we provide evidence that formal land titles do have a positive and significant eect on access to credit and at least part of this effect is best interpreted as an improvement in ex-ante information ows. This result stands in contrast to the prevailing notion that land titles only function as collateral. Analysts who neglect local banking practices may misinterpret the observed effect of systematic land titling programs on credit access because these programs tend to dampen the signaling value of formal land titles.
Date:	2010–12
URL:	http://d.repec.org/n?u=RePEc:cfr:cefirw:w0155&r=mfd

Microcrédito com moral hazard

By:	Rodrigo Peñaloza (Departamento de Economia (Department of Economics) Faculdade de Economia, Administração, Contabilidade e Ciência da Informação e Documentação (FACE) (Faculty of Economics, Administration, Accounting and Information Science) Universidade de Brasília); Raquel Filgueiras (Departamento de Economia (Department of Economics) Faculdade de Economia, Administração, Contabilidade e Ciência da Informação e Documentação (FACE) (Faculty of Economics, Administration, Accounting and Information Science) Universidade de Brasília)
Abstract:	O problema dos incentivos nos contratos de microcrédito foi estu- dado por Laffont & N'Guessan (2000) no contexto de seleção adversa. Construímos um modelo Principal-Agente para modelar o microcrédito no contexto de moral hazard. A novidade é que, em nosso modelo, as restrições de compatibilidade de incentivos incorporam a responsabilidade conjunta, que é a principal característica dos contratos de microcrédito. Determinamos os contratos ótimos tanto no caso de responsabilidade privada limitada como sem responsabilidade privada limitada, em cada caso calculando o excedente do Principal e estabelecendo as condições para contratos interiores e contratos de canto.
Keywords:	microcrédito, moral hazard, responsabilidade conjunta
JEL:	D82 D86
Date:	2011–01
URL:	http://d.repec.org/n?u=RePEc:brs:wpaper:350&r=mfd

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