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The Political Economy of Agricultural Credit: The Case of Bolivi
Author(s) -
Ladman Jerry R.,
Tinnermeier Ronald L.
Publication year - 1981
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1239812
Subject(s) - politics , distribution (mathematics) , government (linguistics) , agriculture , economics , context (archaeology) , inflation (cosmology) , income distribution , economic system , political science , geography , mathematical analysis , linguistics , philosophy , physics , mathematics , archaeology , theoretical physics , law , inequality
A theoretical framework is established to show that agricultural credit programs in less developed countries can be used for political purposes because of ( a ) government‐controlled supply; ( b ) implicit income transfers associated with concessionary interest rates, delinquency, and inflation that can be used as patronage for politically influential borrowers; and ( c ) ease of implementation under guise of economic objectives. The framework is applied to Bolivia. Within that country's political context, large income transfers to a few influential farmers strongly suggest the importance of political factors in credit allocation with consequent effects on income distribution, development, and debilitation of financial institutions.