Credit Market Failures and Policy
AbstractIn a simplified version of the Stiglitz–Weiss (1981) model of the credit market we characterize optimal policies to correct market failures. Widely applied policies, notably interest–rate subsidies and investment subsidies, are compared to the theoretical optimum. Some comments on the trade-off between credit subsidy and infrastructural investment are added in the conclusions.
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Bibliographic InfoPaper provided by University of Brescia, Department of Economics in its series Working Papers with number ubs0607.
Date of creation: 2006
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Other versions of this item:
- NEP-ALL-2006-04-22 (All new papers)
- NEP-CFN-2006-04-22 (Corporate Finance)
- NEP-FIN-2006-04-22 (Finance)
- NEP-FMK-2006-04-22 (Financial Markets)
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