CREDIBLE COMMITMENTS, CONTRACT ENFORCEMENT PROBLEMS AND BANKS - INTERMEDIATION AS CREDIBILITY ASSURANCE

被引:35
作者
BOOT, AWA
THAKOR, AV
UDELL, GF
机构
[1] INDIANA UNIV,SCH BUSINESS,BLOOMINGTON,IN 47405
[2] NYU,GRAD SCH BUSINESS ADM,NEW YORK,NY 10003
关键词
D O I
10.1016/0378-4266(91)90088-4
中图分类号
F8 [财政、金融];
学科分类号
0202 ;
摘要
We consider contract enforceability problems in credit transactions and justify a bank as an organizational solution to market breakdown due to unenforceable contracts. Specifically, we explain: (i) why loan commitments exist, and (ii) why banks exist to sell such commitments. A loan commitment resolves moral hazard more efficiently than any combination of inside equity and spot credit. However, the market breaks down if commitment sellers are individuals, because their promises to honor contracts are not credible. With a large bank, a perfect sequential equilibrium is obtained in which credibility is restored. © 1991.
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页码:605 / 632
页数:28
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