Data/hora: 09/06/2024 04:48:18

Provedor de dados: | Research in Agricultural & Applied Economics (AgEcon Searh)
País: | United States
Título: | Elasticities of Demand for Consumer Credit
Autores: | Karlan,   Dean S.; Zinman,   Jonathan.
Data: | 2006-01-26
Ano: | 2005
Palavras-chave: | Credit markets; Microfinance; Demand elasticity; Development finance; Maturity elasticity; Consumer credit; Liquidity constraints; Consumer/Household Economics; Demand and Price Analysis; D1; D9; E2; G2; O1.
Resumo: | The price elasticity of demand for credit has major implications for macroeconomics, finance, and development. We present estimates of this parameter derived from a randomized trial. The experiment was implemented by a consumer microfinance lender in South Africa and identifies demand curves that, while downward-sloping with respect to price, are flatter than recent estimates in both developing and developed countries throughout most of a wide price range. However, demand becomes highly price sensitive at higher-than-normal rates. We discuss several interpretations of this kink and present some related evidence. We also find that loan size is far more responsive to changes in loan maturity than to changes in interest rate. This pattern is more pronounced among lower income individuals, a comparative static that has been observed in the United States as well and is consistent with liquidity constraints that decrease with income.
Tipo: | Working or Discussion Paper
Idioma: | Inglês

Identificador:

19592

http://purl.umn.edu/28485

Editor: | AgEcon Search

Relação:

Yale University&gt;Economic Growth Center&gt;Center Discussion Papers

Center Discussion Paper No. 926

Formato:

43

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