TY  - BOOK
AU  - Goldberg,Jessica
AU  - Gine,Xavier
AU  - Goldberg,Jessica
AU  - Yang,Dean
TI  - Identification strategy: a field experiment on dynamic incentives in rural credit markets 
PY  - 2010///
CY  - Washington, D.C.
PB  - The World Bank
KW  - Access to credit
KW  - Access to Finance
KW  - Bankruptcy and Resolution of Financial Distress
KW  - Borrower
KW  - Collateral
KW  - Credit market
KW  - Credit markets
KW  - Debt Markets
KW  - Defaulters
KW  - Economic Theory & Research
KW  - Finance and Financial Sector Development
KW  - Information asymmetries
KW  - International bank
KW  - Lender
KW  - Lenders
KW  - Loan
KW  - Loan sizes
KW  - Loan terms
KW  - Macroeconomics and Economic Growth
KW  - Microfinance
KW  - Moral hazard
KW  - Profitability
KW  - Public policy
KW  - Repayment
KW  - Repayment rates
KW  - Rural credit
N2  - How do borrowers respond to improvements in a lender's ability to punish defaulters? This paper reports the results of a randomized field experiment in rural Malawi that examines the impact of fingerprinting borrowers in a context where a unique identification system is absent. Fingerprinting allows the lender to more effectively use dynamic repayment incentives: withholding future loans from past defaulters while rewarding good borrowers with better loan terms. Consistent with a simple model of borrower heterogeneity and information asymmetries, fingerprinting led to substantially higher repayment rates for borrowers with the highest ex ante default risk, but had no effect for the rest of the borrowers. The change in repayment rates is driven by reductions in adverse selection (smaller loan sizes) and lower moral hazard (for example, less diversion of loan-financed fertilizer from its intended use on the cash crop)
UR  - http://elibrary.worldbank.org/doi/book/10.1596/1813-9450-5438
ER  -