Abstract
Since the beginning of the economic reform in Bulgaria, flows of credit to agriculture have decreased. As the farm credit issue has an extremely high profile in the public debate about the crisis in agriculture, the government finds itself under extreme pressure to assist in financing the sector. Some of the difficulties in the credit market for agriculture have the characteristics of market failures. On this basis the case for government intervention is assessed. The conclusion is that government policy measures which have been implemented are not well suited to solving the problems; rather, they deal somewhat haphazardly with the symptoms. Resolution of the problems requires government intervention in the following forms: in the short run, resolution of held-over bad loans and provision of collateral guarantees; in the medium run, significant progress on the restitution of land titles, provision of information and extension services, including financial consultancies for the farmers, and training for bank officials dealing with agricultural lending; and in the long run, creating more competition in both input and output markets.
Keywords
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsPreview
Unable to display preview. Download preview PDF.
References
Berov, L., 1989.The Bulgarian Economy until the Socialist Revolution(in Bulgarian). Pp. 311–320, 474–477. Science and Art Publishing House, Sofia, Bulgaria.
Berov, L., 1992. Traditions and Opportunities for Agricultural Credit in BulgariaBank ReviewNo 1 (in Bulgarian).
Calvo, G., and J. Frenkel, 1991. Credit Markets, Credibility,and Economic TransformationJournal of Economic Perspectives5, Number 4.
Durjaven vestnik(State gazette), 24, March 26, 1993 (a).
Durjaven vestnik(State gazette), 33, April 20, 1993 (b).
Guinnane, T., 1993. “Cooperatives as Information Machines: The Lending Practices of German Agricultural Credit Cooperatives, 18831914.” Economic Growth Center, Yale University, Center Discussion Paper No. 699.
Layard, P.R.G. and Walters, A.A., 1987.Microeconomic Theory. International Editon. McGraw-Hill Book Company, New York.
Petranov, S., and Roussinov, K., 1993. “A Model for Estimating the Aggregate Cash-Flow in Agriculture.” Working Paper No 3, APAU Project 92.1, PHARE Programme, Ministry of Agriculture, Sofia, Bulgaria.
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 1994 Springer Science+Business Media New York
About this chapter
Cite this chapter
Petranov, S., Roussinov, K. (1994). Credit for Agriculture During the Transition. In: Schmitz, A., Moulton, K., Buckwell, A., Davidova, S. (eds) Privatization of Agriculture in New Market Economies: Lessons from Bulgaria. Natural Resource Management and Policy, vol 6. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-1388-5_17
Download citation
DOI: https://doi.org/10.1007/978-94-011-1388-5_17
Publisher Name: Springer, Dordrecht
Print ISBN: 978-94-010-4608-4
Online ISBN: 978-94-011-1388-5
eBook Packages: Springer Book Archive