Repayment versus Investment Conditions and Exclusivity in Lending Contracts - 10.1628/093245611796589915 - Mohr Siebeck
Economics

Spiros Bougheas, Indraneel Dasgupta, Oliver Morrissey

Repayment versus Investment Conditions and Exclusivity in Lending Contracts

Volume 167 () / Issue 2, pp. 247-265 (19)

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Lenders condition future loans on some index of past performance. Typically, banks condition future loans on repayments of earlier obligations, whilst international organizations (official lenders) condition future loans on the implementation of some policy action (»investment«). We build an agency model that accounts for these tendencies. The optimal conditionality contract depends on exclusivity — the likelihood that a borrower who has been denied funds from the original lenders cannot access funds from other lenders.
Authors/Editors

Spiros Bougheas No current data available.

Indraneel Dasgupta No current data available.

Oliver Morrissey No current data available.