Gerling, Kerstin
[Verfasser:in]
;
Kowalik, Michal K.
[Sonstige Person, Familie und Körperschaft];
Schumacher, Heiner
[Sonstige Person, Familie und Körperschaft]
Entrepreneurial Risk Choice and Credit Market Equilibria
Erschienen in:Federal Reserve Bank of Kansas City Research Paper Series ; No. 10-13
Umfang:
1 Online-Ressource (22 p)
Sprache:
Englisch
DOI:
10.2139/ssrn.1703683
Identifikator:
Entstehung:
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments November 5, 2010 erstellt
Beschreibung:
We analyze under what conditions credit markets are efficient in providing loans to entrepreneurs who can start a new project after previous failure. An entrepreneur of uncertain talent chooses the riskiness of her project. If banks cannot perfectly observe the risk of previous projects, two equilibria may coexist: (1) an inefficient equilibrium in which the entrepreneur undertakes a low-risk project and has no access to finance after failure; and (2) a more efficient equilibrium in which the entrepreneur undertakes high-risk projects and gets financed even after an endogenously determined number of failures