Product quality, lender liability, and consumer credit
AbstractUnder 'linked credit' (also known as 'connected lending'), the buyer obtains a loan from a lender with the specific purpose of purchasing a certain product. Credit is arranged directly by the seller, who acts as an intermediary for the finance company. Within this form of financing, the lender often accepts a measure of liability for defective products. We show that 'connected-lender liability' can work as a signalling device for the reliability of sellers, so as to alleviate the market failure that arises when sellers are better informed than consumers about the quality of their products. Copyright 2004, Oxford University Press.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Oxford University Press in its journal Oxford Economic Papers.
Volume (Year): 56 (2004)
Issue (Month): 2 (April)
Contact details of provider:
Postal: Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK
Fax: 01865 267 985
Web page: http://oep.oupjournals.org/
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Alena Bicakova, 2007.
"Does the Good Matter? Evidence on Moral Hazard and Adverse Selection from Consumer Credit Market,"
Economics Working Papers
ECO2007/02, European University Institute.
- Alena Bicakova, 2007. "Does the Good Matter? Evidence on Moral Hazard and Adverse Selection from Consumer Credit Market," Giornale degli Economisti, GDE (Giornale degli Economisti e Annali di Economia), Bocconi University, vol. 66(1), pages 29-66, March.
- Elisabetta Iossa & Giuliana Palumbo, 2006.
"Overoptimism and Lender Liability in the Consumer Credit Market,"
Temi di discussione (Economic working papers)
598, Bank of Italy, Economic Research and International Relations Area.
- Elisabetta Iossa & Giuliana Palumbo, 2010. "Over-optimism and lender liability in the consumer credit market," Oxford Economic Papers, Oxford University Press, vol. 62(2), pages 374-394, April.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.