What are the sources of inefficiency in credit markets

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In the 2010 article Giving Credit Where It Is Due by A. Banerjee and E. Duflo, the authors present a number of facts and interpretations on the workings of informal credit markets in less developed countries. Based on these facts, the authors pose the following two questions: (1) Is access to reasonably priced credit really a problem for the poor? (2) What are the sources of inefficiency in credit markets? Based on the readings and the discussion in lecture, briefly discuss the main arguments and the economic evidence for each question

Reference no: EM131101546

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