Corruption, Default and Optimal Credit in Welfare Programs

Abstract

In this paper a dynamic model of subsidized credit provision is presented to examine how asymmetric information exacerbates inefficiency caused by corruption. Though designed to empower the underprivileged, the fate of such credit programs largely depends on the efficiency of the credit delivery system. [IGIDR WP 2004-001].credit, corruption, asymmetric, information, inefficiency, delivery, system,