interlinked Credit Contracts and Determinants of Borrowing in the Informal Interlinked Agricultural Credit Market

摘要

There is a large-scale expansion of informal credit with high degree of commercialisation in agriculture (Feder et al, 1988, Bell, 1990, Reddy, 1992, Swaminathan, 1993, Birthal and Singh, 1993. Bell et al, 1988, Reddy, 1992). The literatureon agrarian contracts in the less developed countries highlights the presence ofinterlinked markets in tlie informal credit. An interlinked contract is one in which two or more interdependent exchanges are simultaneously agreed upon. While interlinkage may be of various kinds, the most commonly observed ones are those involving the informal (agrarian) credit markets, the labour market, the land market and the market for grains. The nature of linkages depends on the relative bargaining power of the parties involved in credit transactions, relative urgency of credit and the availability of formal credit. Hence, a linkage may be either beneficial to both the parties involved in credit transactions or disadvantageous to tlie weaker parties (Reddy, 1992). Since interlinked contracts form an integral part of the rural economy, the subject of interlinkage had received a great deal of empirical attention (Bardhan and Rudra, 1978). Hence the focus of the present study entitled "Determinants of interlinked credit contracts in informal agricultural credit market is to examine, tlie role of informal credit market in agriculture, types of interlinked credit transactions and the determinants of interlinked credit transactions. The specific objectives of the study