The economics of lending with joint liability: theory and practice
نویسندگان
چکیده
Institutions that rely on joint liability to facilitate lending to the poor have a long history and are now a common feature of many developing countries. Economists have proposed several theories of joint-liability lending that stress various aspects of its informational and enforcement advantages over other forms of lending. This paper analyzes how joint-liability lending promotes screening, monitoring, state verification and enforcement of repayment. An empirical section draws on case studies to highlight how joint liability works in practice. q 1999 Elsevier Science B.V. All rights reserved. JEL classification: D82; G20; N23; O12
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