Informal Finance: A Theory of Moneylenders

Using the Theory of Network in Finance

It is very important for managers, investors and financial policy-makers to detect and analyze factors affecting financial markets to obtain optimal decision and reduce risks. The importance of market analysis and attempt to improve its behavior understanding, has led analysts to use the experiences of other professionals in the fields such as social sciences and mathematics to examine the inte...

A Theory of Informal Justice∗

This paper develops a positive model of informal justice in which rewards and punishments are not determined by an ex ante optimal contract but instead express the ex post moral sentiments of the arbitrating party. In our model, a third party arbitrator mediates a one-shot relationship between two players, one of whom can exert an externality on the other. Importantly, formal contracts are not ...

using the theory of network in finance

it is very important for managers, investors and financial policy-makers to detect and analyze factors affecting financial markets to obtain optimal decision and reduce risks. the importance of market analysis and attempt to improve its behavior understanding, has led analysts to use the experiences of other professionals in the fields such as social sciences and mathematics to examine the inte...

Toward a Quantitative Theory of Informed Finance

We develop a model of informed finance that explains the key qualitative and quantitative features of informed venture capital finance in the United States. We show that the two key features of our model— potential investors are better judges than entrepreneurs of a project’s economic viability and projects require both significant external funding and entrepreneurial inputs—give rise to under-...

The Theory of Corporate Finance