Demand for Agricultural Loans: A Theoretical and Econometric Analysis of the Philippine Credit Market

Estimates of loan demand are often biased and inefficient due to data truncation and the use of data on individual loans that suffers from non-identifiability of aggregate demand and supply factors. This paper develops a framework to measure loan demand as a sum of all loans received during a period and applies a type three Tobit model to estimate it among farm households in the Philippines. The results suggest that the framework using total loans to estimate loan demand provides a statistically better fit than loan demand estimated using data on individual loans

Bank Branches and Rural Deposits: Evidence from Bangladesh

Revised August, 1990. Originally released as ESO 1462, May, 1988

The Determinants of Rural Deposits in Bangladesh

A simultaneous relationship between interest-bearing deposits and rural bank branch density exists in Bangladesh. Permanent income directly affects bank density and indirectly affects deposits. Bank density and availability of roads and vehicles affect depositor behavior through their effect on transaction costs. Transitory income and literacy also positively affect deposits

Are Commercial Banks Really More Efficient than Agricultural Development Banks? Evidence from Bangladesh

Previous studies have argued that commercial banks are more efficient in making and recovering loans than are development banks. Few studies, however, directly compare the efficiency of the two types of banks operating in the same market area. This study in Bangladesh made such a comparison. A normalized profit function was estimated based on the data collected from rural bank branches for the years 1987 and 1988. The results showed that the nationalized commercial bank branches were relative price efficient with respect to wages, while the development bank branches were relative price efficient with respect to deposit interest rates. The development bank branches were relative technical efficient with respect to loans made, while there was no technical efficiency differences between the two bank types with respect to deposits. These results suggest that the issue of relative bank efficiency is unique to each country and cannot be easily generalized

Are Rural Commercial Banks Really More Efficient Than Agricultural Development Banks? - New Evidence from Bangladesh

This paper presents an analysis of the relative economic efficiency of rural commercial and development banks in Bangladesh using a normalized profit function. Contrary to the experiences of other developing countries, the development banks are relatively more technical and price efficient in producing loans than commercial banks

Segmentation in the Philippine Informal Credit Marktes: A Multinomial Logit Analysis

The paper explains the market segmentation that occurs in the Philippine informal credit markets through the matching of borrows and lenders by their occupational specialization which internalizes transaction costs and facilitates economic activity. The regression results support a predictable pattern of matching farmers lenders with borrowers specialization in non-farm activities and trader lenders with borrowers specialized in farming