Financing Experimentation

• 成果类型: Article
• 署名作者: Drugov, Mikhail; Macchiavello, Rocco
• 署名单位: Universidad Carlos III de Madrid; Center for Economic & Policy Research (CEPR); University of Warwick
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.6.1.315
• 发表日期: 2014
• 页码: 315-349
• 关键词: credit market; moral hazard; INFORMATION; CONTRACTS; COMPETITION; equilibria; access

摘要

Entrepreneurs must experiment to learn how good they are at a new activity. What happens when the experimentation is financed by a lender? Under common scenarios, i.e., when there is the opportunity to learn by starting small or when noncompete clauses cannot be enforced ex post, we show that financing experimentation can become harder precisely when it is more profitable, i.e., for lower values of the known arm and for more optimistic priors. Endogenous collateral requirements (like those frequently observed in microcredit schemes) are shown to be part of the optimal contract.