Government credit programs: Justification, benefits, and costs | Land Portal
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Date of publication: 
Janeiro 1988
ISBN / Resource ID: 
129562
Pages: 
20 pages
Copyright details: 
IFPRI adheres to the basic tenets of the Budapest Open Access Initiative, articulated in 2002 (subject to any applicable third-party rights and or confidentiality obigations). All applicable data are subject to IFPRI’s Institutional Review Board (IRB) guidelines. Copyright © 2013 International Food Policy Research Institute (IFPRI). All rights reserved.

Subsidized credit programs for agricultural producers have often been used to boost production in less developed countries. The "traditional" views in support of this policy instrument, as summarized by von Pischke, Adams, and Donald (1983), are that credit programs are easier to implement than such policies as land reform or infrastructure development, that subsidized credit can offset the negative impact on farm income and disincentives of government policies such as overvalued exchange rates and price controls, and that credit programs are necessary to provide capital for adoption of new technology. The informal credit market moneylenders are considered monopolistic, exploitive, and antidevelopmental, and incapable of providing the necessary credit.

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The International Food Policy Research Institute (IFPRI) provides research-based policy solutions to sustainably reduce poverty and end hunger and malnutrition in developing countries. Established in 1975, IFPRI currently has more than 500 employees working in over 50 countries. It is a research center of theCGIAR Consortium, a worldwide partnership engaged in agricultural research for development.

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