Marketing efficiency, informal credit, and the role of government loan programs: cassava trade in Indonesia

The structure of informal credit relations in the cassava trade on Java, Indonesia, is examined to demonstrate how: 1. credit market imperfections can lead to commodity market imperfections, and 2. government credit programs can increase marketing efficiency by offsetting some informal credit limita...

Full description

Saved in:
Bibliographic Details
Published in:The Journal of developing areas 1986-04, Vol.20 (3), p.369-378
Main Authors: Unnevehr, L.J. (University of Illinois, Urbana), Zain, D
Format: Article
Language:English
Subjects:
ADMINISTRACION
ADMINISTRATION
AGRICULTURE (INCLUDING HUNTING AND GATHERING)
Capital investments
Cassava
Commercial credit
Commodities
COMMODITY MARKETS
CONCURRENCE SUR LES MARCHES
CONCURRENCIA DE MERCADOS
COSTOS
COSTS
COUT
CREDIT
CREDITO
Economic aid
Economic models
Economic Policy
EFFICIENCY AND EFFECTIVENESS
FINANCIAL SERVICE, BANKS, INSURANCE SYSTEMS, SECURITIES, EXCHANGES
Government
Government loans
Government Policy
Government Regulation
Indonesia
Informal
International trade (cassava)
Investment credit
JAVA
LOANS
MANIHOT ESCULENTA
MARCHE DES PRODUITS DE BASE
MARKET COMPETITION
Market Economy
Market segmentation
Marketing
MARKETING SYSTEM
MARKETING TECHNIQUES
MERCADOS DE PRODUCTOS BASICOS
MODELE
MODELOS
Monetary policy
PRESTAMOS
PRETS
Programs
RESOURCE ALLOCATION
Statistical analysis
Systems
TECHNIQUE DE VENTE
TECNICAS DE MERCADEO
Trade
Wholesale trade
Working capital
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:The structure of informal credit relations in the cassava trade on Java, Indonesia, is examined to demonstrate how: 1. credit market imperfections can lead to commodity market imperfections, and 2. government credit programs can increase marketing efficiency by offsetting some informal credit limitations. Cassava is the major source of farm household income from food-crop production in mountainous south-central Java. The market structure differs for dried and fresh cassava. Where formal credit is unavailable, informal credit arrangements have developed to provide working capital. These arrangements ease the mobilization of marketed supply, but they have limitations: 1. On-lending from large to small traders does not equalize access to credit terms. 2. Informal credit contracts do not provide for fixed capital investment. 3. These contracts are linked to specific products. Benefits of government loan programs are due to their availability in rural areas, not to low interest rates.
ISSN:0022-037X
1548-2278