Joint Liability Borrowing and Suicide
This paper shows that joint liability borrowing may put too much pressure on the borrower, mainly through the stigma in case of repayment failure, and leads to a vexing outcome|the suicide of the borrower. We provide a model of joint liability borrowing which facilitates credit market transaction ex ante but may induce suicides ex post in the bad state. We introduce some supportive evidence from a suicide survey in Japan.
|Date of creation:||Dec 2007|
|Date of revision:|
|Contact details of provider:|| Postal: Hongo 7-3-1, Bunkyo-ku, Tokyo 113-0033|
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