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An assignment model of monitored finance
(Centro de Investigación y Docencia Económicas, División de Economía, 2014)
We develop an incentive contracting model of firm formation. Entrepreneurs of private equity firms who differ in net worth are required to borrow from institutional investors in order to finance start up projects. Investors, ...
Competition and bank risk taking in a differentiated oligopoly
(Centro de Investigación y Docencia Económicas, División de Economía, 2014)
We re-examine the relationship between the degree of deposit market competition and bank
risk taking in a model where banks compete in differentiated deposit services. When banks
invest their deposits directly, as has ...
Incentives and competition in microfinance
(Centro de Investigación y Docencia Económicas, División de Economía, 2014)
We develop a model of competition among socially motivated microfinance instituions (MFIs), where the MFIs offer repayment-based incentive contracts to credit agents. The agents gather information regarding a borrower, and ...