Optimal Arrangements for Distribution in Developing Markets: Theory and Evidences

• 成果类型: Article
• 署名作者: Fuchs, William; Green, Brett; Levine, David
• 署名单位: University of Texas System; University of Texas Austin; Universidad Carlos III de Madrid; Washington University (WUSTL); University of California System; University of California Berkeley
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.20190085
• 发表日期: 2022
• 页码: 411-450
• 关键词: Commitment savings; RISK; TECHNOLOGY; INVESTMENT; insurance; CONTRACTS; adoption; constraints; INFORMATION; product

摘要

A large literature examines demand-side barriers to product adoption. In this paper, we examine supply-side barriers in a setting with limited contract enforcement. We model the relationship between a distributor and its credit-constrained vendors. We show that the optimal self-enforcing arrangement can be implemented by providing vendors with a line of credit and the option to buy additional units at a fixed price. Moreover, the structure of this arrangement is optimal both for profit-maximizing firms and for nonprofit organizations with limited resources. We test the arrangement using a field experiment in rural Uganda. We find that the model-implied optimal arrangement increased distribution significantly compared to a standard contract. However, growth was lower than predicted by the model because vendors were unwilling to extend credit to customers and did not have access to a reliable savings technology. We discuss several recent technological innovations that help to overcome both of these challenges.