Intertemporal Consumption and Credit Constraints: Does Total Expenditure Respond to an Exogenous Shock to Credit?

2010 ◽  
Vol 100 (3) ◽  
pp. 1080-1103 ◽  
Author(s):  
Søren Leth-Petersen
Keyword(s):  
Credit Constraints ◽  
Credit Market ◽  
Market Reform ◽  
Household Expenditure ◽  
Total Expenditure ◽  
Exogenous Shock ◽  
Access To Credit ◽  
Intertemporal Consumption ◽  
Aggregate Effect ◽  
Housing Equity

There is continuing controversy over the importance of credit constraints. This paper investigates whether total household expenditure and debt is affected by an exogenous increase in access to credit provided by a credit market reform that enabled Danish house owners to use housing equity as collateral for consumption loans. We find that the magnitude of the response is correlated with the amount of equity released by the reform and that the effect is strongest for younger households. Even for this group, the response was moderate. The aggregate effect of the reform was significant but small. (JEL D14, D91, E21)

scholarly journals Off-farm Income, Credit Constraints, and Farm Investment

2020 ◽  
Vol 52 (4) ◽  
pp. 642-663
Author(s):  
Nigel Key
Keyword(s):  
Household Income ◽  
Credit Constraints ◽  
Limited Resource ◽  
Capital Expenditures ◽  
Farm Income ◽  
Farm Labor ◽  
Federal Programs ◽  
Net Worth ◽  
Access To Credit ◽  
Farm Investment

AbstractMany farmers face borrowing limits that depend on their household income and net worth. Given such credit constraints, an increase in off-farm income should allow farmers to borrow more, thus influencing production decisions and productivity. To test this hypothesis, the education level of the farm operator’s spouse is used to identify exogenous variation in off-farm income. Findings indicate that higher off-farm income leads to more borrowing, capital expenditures, capital input intensity, farm labor use, output, farm income, and productivity. Results suggest that Federal programs that promote access to credit for limited-resource farmers may increase farm investment and productivity.

Access to Formal Credit in the Indian Agriculture: Does Caste matter?

2018 ◽  
Vol 4 (2) ◽  
pp. 169-195
Author(s):  
Karthick V. ◽  
Madheswaran S.
Keyword(s):  
Large Scale ◽  
Descriptive Analysis ◽  
Social Groups ◽  
Critical Factor ◽  
Credit Market ◽  
Access To Resources ◽  
Access To Credit ◽  
Indian Agriculture ◽  
Discrimination Coefficient ◽  
Lower Castes

Access to resources and opportunities can be a critical factor in improving outcomes for disadvantaged groups. Improving access to financial resources, in particular, is widely acknowledged to facilitate upward economic and social mobility. Conversely, lack of access to resources for certain groups based on caste, class, gender and ethno-social identities can perpetuate inequalities. In this context, this paper attempts to analyse the access to credit by social groups and decomposes the gross credit differentials using Oaxaca-blinder decomposition method using unit-level data from the All India Debt and Investment Survey, NSSO, 2013. The descriptive analysis clearly shows that there is a significant credit differential between forward caste (FC) and other social groups (SC, ST and OBC). Access to credit varies across social groups based on many factors. The decomposition result indicates that the discrimination coefficient against SC is 49per cent which explains that SCs are being discriminated by 49 per cent compared to FCs in the formal credit market. In case of ST, the discrimination coefficient against is 61per cent and for OBC it is 48per cent. Interestingly, the endowment difference is less among ST (38per cent) compared to SC and OBC (around 51 per cent). Also, the FC treatment advantage (benefit of being a FC in the credit market) is 5.7 per cent whereas the cost of being an SC in the credit market (treatment disadvantage) is 35.1 per cent. As expected, the disadvantage component for ST and OBC is 33.1 per cent and 17.8 per cent respectively. Thus, we see that although programmes, schemes and policies to promote the economic empowerment of lower castes through finance have been implemented on a large scale since the 1990s, they have not been very effective.

scholarly journals MOTIVASI KEWIRAUSAHAAN PETANI PADI ORGANIK DI KABUPATEN BANTUL

2017 ◽  
Vol 12 (1) ◽  
pp. 19
Author(s):  
Nur Ratmawati ◽  
Triyono Triyono ◽  
Sriyadi Sriyadi
Keyword(s):  
Credit Market ◽  
Business Environment ◽  
Survey Method ◽  
Individual Factors ◽  
Access To Credit ◽  
Rice Farmers ◽  
Organic Rice ◽  
Interview Survey ◽  
The Government ◽  
The Individual

The  improvement  of  farmers’  welfare,  especially  rice  farmers  require efforts  to  improve  the  ability  of  farmers  to  produce  quality  products  and  which  is competitive. An effort that can be done is to increase the motivation of entrepreneur communities  through  organic  farming  which  can  be  expected  to  ensure  the preservation of the environment for sustainable production, achieve food security at the same time improving the welfare of people that having quality.This research aims to identify the motivation of entrepreneur    farmers and the individual factors and the influence  of  environments.  The  study  was  conducted  by  interview  survey  method  on organic rice farmers, then it was analyzed by descriptive and regression analysis. The results showed that the general motivation of entrepreneur farmers is strong enough. Factors that influence entrepreneurmotivation is the business environment; access to credit, market orientation, a network of cooperation and support from the government as well as individual factors, namely education.

scholarly journals Empowering Cities: Good for Growth? Evidence from the People's Republic of China

2018 ◽  
Vol 35 (1) ◽  
pp. 175-195
Author(s):  
Megha Mukim ◽  
T. Juni Zhu
Keyword(s):  
Gross Domestic Product ◽  
Local Governments ◽  
Credit Constraints ◽  
High Capacity ◽  
Economic Outcomes ◽  
Firm Level ◽  
Access To Credit ◽  
Republic Of China ◽  
Firm Outcomes ◽  
Local Leaders

This paper utilizes a countrywide process of county-to-city upgrading in the 1990s to identify whether extending the powers of urban local governments leads to better firm outcomes. The paper hypothesizes that since local leaders in newly promoted cities have an incentive to utilize their new administrative remit to maximize gross domestic product and employment, there should be improvements in economic outcomes. In fact, aggregate firm-level outcomes do not necessarily improve after county-to-city graduation. However, state-owned enterprises perform better after graduation, with increased access to credit through state-owned banks as a possible explanation. Importantly, newly promoted cities with high capacity generally produce better aggregate firm outcomes compared with newly promoted cities with low capacity. The conclusions are twofold. First, relaxing credit constraints for firms could lead to large increases in their operations and employment. Second, increasing local government's administrative remit is not enough to lead to better firm and economic outcomes; local capacity is of paramount importance.

scholarly journals Financing Constraints and Access to Credit in a Postcrisis Environment: Evidence from New Farmers in Alabama

2012 ◽  
Vol 44 (4) ◽  
pp. 607-621 ◽  
Author(s):  
Valentina Hartarska ◽  
Dennis Nadolnyak
Keyword(s):  
Financial Crisis ◽  
Survey Data ◽  
Credit Market ◽  
Cash Flows ◽  
Financing Constraints ◽  
2008 Financial Crisis ◽  
Access To Credit ◽  
Self Selection ◽  
The 2008 Financial Crisis ◽  
New Farmers

We use survey data to study the degree to which new farming operations in Alabama were financially constrained after the 2008 financial crisis. Next, we control for farmers' self-selection out of the credit market and identify which farmers were able to secure loans during the period of 2009–2010. The results show that new farmers that started any part of their operation after 2005 were financially constrained but no evidence that their financing constraints were affected by the crisis. As expected, we find that lending was collateral-driven, although lenders also considered farmers' profitability and cash flows.

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