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Uncertainty, market power and credit rationing

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  • Paul Ramskogler

    () (Department of Economics, Vienna University of Economics & B.A.)

Abstract

This paper explores the nexus between uncertainty and credit restrictions. A Post Keynesian approach to an explanation of access rationing to credit is developed and contrasted with the dominant relationship lending school. It is argued that access rationing to credit has be understood in terms of uncertainty and power. Differences in systemic uncertainty to which hetrogenous market participants are exposed can explain the reluctance of banks to lend to certain applicants. Monopsonistic power and uncertainty further help to understand why banks of a different size show differences in their lending behavior.

Suggested Citation

  • Paul Ramskogler, 2007. "Uncertainty, market power and credit rationing," Department of Economics Working Papers wuwp105, Vienna University of Economics and Business, Department of Economics.
  • Handle: RePEc:wiw:wiwwuw:wuwp105
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    Cited by:

    1. Guglielmo Forges Davanzati, 2015. "Nicholas Kaldor on endogenous money and increasing returns," Working Papers PKWP1505, Post Keynesian Economics Study Group (PKSG).

    More about this item

    JEL classification:

    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D89 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Other

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