When lenders face challenges like moral hazard, adverse selection, and weak contract enforcement, they will do their best to mitigate them.
Category: Information Asymmetry
Why Credit Bureaus? Information Asymmetry (Pt. 1)
Whether providing high-interest loans in informal markets, or billion dollar loans to multinational corporations, lenders everywhere face the same challenge - gaining enough information about borrowers to mitigate the risk of non-performing loans.
