Rural financial markets under transformation [Elektronische Ressource] : a study on credit supply and demand in Romania's private farm sector / vorgelegt von Barbara Breitschopf

Babs

Informations

• Publié par: universitat_hohenheim
• Publié le: 01 janvier 2003
• Nombre de lectures: 5
• Langue: English
• Poids de l'ouvrage: 2 Mo

Extrait

Aus dem Institut für Agrar- und Sozialökonomie
der Tropen und Subtropen
Universität Hohenheim
Fachgebiet: Agrarökonomie
Prof. Dr. F. Heidhues




Rural Financial Markets under Transformation:
A Study of Credit Supply and Demand
in Romania’s
Private Farm Sector













Dissertation
zur Erlangung des Grades eines Doktors
der Agrarwissenschaften
der Fakultät IV – Agrarwissenschaften II







vorgelegt von
MA Econ., Dipl.-Ing-agr. Barbara Breitschopf
geb. in Öhringen




Juli 2002

Die vorliegende Arbeit wurde am 13.01.2003 von der Fakultät IV – Agrarwissenschaften II –
der Universität Hohenheim als „Dissertation zur Erlangung des Grades eines Doktors der
Agrarwissenschaften“ angenommen.



Tag der mündlichen Prüfung: 25.02.2003


Dekan: Prof. Dr. Stahr


Berichterstatter, 1. Prüfer: Prof. Dr. Heidhues


Mitberichterstatter, 2. Prüfer: Prof. Dr. Zeddies


weitere Berichter bzw. Prüfer: Prof. Dr. Grosskopf


ii
Table of content

1 Introduction ....................................................................................................1
1.1 General situation in Romania.........................................................................1
1.2 Objective and structure of the study ..............................................................3
2 Romania’s economy in transition and the changing financial and
agricultural sector...........................................................................................5
2.1 The discussion on financial and economic development...............................5
2.1.1 Financial markets and rural finance 5
2.1.2 Financial sector development in transition economies 8
2.1.3 From a centrally planned to a market economy 10
2.1.4 Discussions on transformation and the financial sector in Romania 12
2.1.5 mation and the agricultural sector in Romania 14
2.2 Description and analysis of the financial sector in Romania........................16
2.2.1 The monetary market 16
2.2.2 The capital market 33
2.2.3 The insurance market 35
2.3 Description of the agricultural sector in Romania ........................................37
2.3.1 The agricultural production 37
2.3.2 Agriculture from a regional perspective 39
2.3.3 Structure of the villages interviewed 40
2.3.4 The path to economic development 42
3 Data and methodology.................................................................................46
3.1 Data .............................................................................................................46
3.1.1 Origin of the data 46
3.1.2 Sampling process of the farm data 46
3.1.3 Data selection and analysis 48
3.2 Methodology ................................................................................................49
3.2.1 Rural financial markets: a quantitative analysis 49
3.2.2 Rural financial markets and asymmetric information: a qualitative
approach 63
3.2.3 The agricultural micro-enterprise, risk and risk aversion: a qualitative
analysis 66
4 Rural financial markets ................................................................................69
4.1 Descriptive statistical results........................................................................69
4.2 The production function ...............................................................................70
4.3 The farm profit and demand function...........................................................73
4.4 Capital demand, uncertainty and collateral requirement..............................76
4.4.1 Capitaldemandfor own or external capital 76
4.4.2 Capital demand in combination with external and own capital 80
4.4.3 Capital demand under risk aversion 82
4.5 Supply of capital...........................................................................................85
4.6 Supply of and demand for capital ................................................................90
4.7 Financial sector and adverse selection........................................................96
4.8 Agricultural sector and risk aversion..........................................................101
5 Conclusion .................................................................................................110
5.1 Financial sector..........................................................................................110
5.2 Agricultural sector ......................................................................................111
5.3 Rural financial markets ..............................................................................111
5.3.1 The capital demand of individual farmers 112
5.3.2 Capital supply 113
5.3.3 Capital demand and supply 114
5.3.4 Information asymmetry and collateral value 114
5.3.5 Risk aversion and farm households 115
iii
5.4 Policy options.............................................................................................115
6 References.................................................................................................118
7 Annex.........................................................................................................126
7.1 Annex: Distributions...................................................................................126
7.2 Annex: Sub-samples..................................................................................127
7.3 Annex: Loans129
7.4 Annex: Regressions131
7.5 Annex: Multicollinearity ..............................................................................132
7.6 Annex: Heteroscedasticity .........................................................................133
7.7 Annex: Farm profit .....................................................................................138
7.8 Annex: Loss and profit situation.................................................................139


iv

List of figures

Figure 1 Sections, topics and issues of the study 4
Figure 2 Financial sector 16
Figure 3 Banking sector 20
Figure 4 The structure of the capital and exchange market in Romania 33
Figure 5 Development circle 45
Figure 6 Model structure 50
Figure 7 Asymmetric information 63
Figure 8 Frequency distribution of the net income in relation to capital expenditure 70
Figure 9 Production function of an average individual farm 71
Figure 10 Profit of an average individual farm under negative and positive real
interest rates. 76
Figure 11 Profit of an average farm under uncertainty and with transaction costs for
external capital 79
Figure 12 Profit or loss situation under positive real rates and relaxed collateral
requirements 83
Figure 13 Casetree87
Figure 14 Capital supply set of a financial institution, under high inflation in relation
to p (case II)88
Figure 15 stitution under low inflation in relation
to p (case I andIV)88
Figure 16 Case(1)91
Figure 17 Case(2)92
Figure 18 Case (3) 92
Figure 19 Case (4) 93
Figure 20 Case (5) 93
Figure 21 Case (6) 94
Figure 22 Case (7) 94
Figure 23 Collateral value 98
Figure 24 Adverse selection 100
Figure 25 Adverse selection and risk aversion 101
Figure 26 Expected utility 105
Figure 27 Acceptance set 108


v

List of tables

Table 1 Economic data 1
Table 2 Monetary indicators 19
Table 3 Balance sheet of the National Bank of Romania, end of 1997 21
Table 4 Aggregated balance sheet of Romanian commercial banks, end of 1997 22
Table 5 Commercial banks end of 1996 24
*1Table 6 Loan types 27
Table 7 Procedure for different loan types 31
Table 8 Selected price indices, Dec. 1996 = 100, otherwise indicated 39
Table 9 Selected data from the three regions in 1997 40
Table 10 a from the individual farm survey, 1997 41
Table 11 Statistical figures of the observed variables 69
Table 12 Regression results of the Cobb-Douglas production technology 70
Table 13 Marginal products 72
Table 14 Marginal rate of technical substitution (RTS) 72
Table 15 Demand for input factors 74
Table 16 capital under positive real interest rates 74
Table 17 Capital demand under negative real interest rates with tough collateral
requirements and uncertainty of return 77
Table 18 Capital demand under uncertainty and negative real interest rates with
relaxed loan requirements 78
Table 19 Capital demand under uncertainty and positive real interest rates with tough
collateral requirements 78
Table 20 eal interest rates with
relaxed collateral requirements 79
Table 21 Demand for external capital under uncertainty and negative real rates with
tough collateral requirements and own capital K 80 o
Table 22 Demand for certainty, tough collateral requirements
and subsidized loan interest rates and with own capital K 81 o
Table 23 External capital demand under positive real rates with tough collateral
requirements under unc