Skip to content Skip to navigation
University of Warwick
  • Study
  • |
  • Research
  • |
  • Business
  • |
  • Alumni
  • |
  • News
  • |
  • About

University of Warwick
Publications service & WRAP

Highlight your research

  • WRAP
    • Home
    • Search WRAP
    • Browse by Warwick Author
    • Browse WRAP by Year
    • Browse WRAP by Subject
    • Browse WRAP by Department
    • Browse WRAP by Funder
    • Browse Theses by Department
  • Publications Service
    • Home
    • Search Publications Service
    • Browse by Warwick Author
    • Browse Publications service by Year
    • Browse Publications service by Subject
    • Browse Publications service by Department
    • Browse Publications service by Funder
  • Help & Advice
University of Warwick

The Library

  • Login
  • Admin

Financing experimentation

Tools
- Tools
+ Tools

Macchiavello, Rocco (2013) Financing experimentation. Working Paper. Coventry, UK: Department of Economics, University of Warwick. Warwick economics research papers series (TWERPS), Volume 2013 (Number 1025).

[img]
Preview
Text (Working paper)
WRAP_twerp_1025_macchiavello.pdf - Published Version

Download (476Kb) | Preview
Official URL: http://www2.warwick.ac.uk/fac/soc/economics/resear...

Request Changes to record.

Abstract

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
"no-compete" clauses cannot be enforced ex-post, we show that financing experi-
mentation 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 micro-credit schemes) are shown to
be part of the optimal contract.

Item Type: Working or Discussion Paper (Working Paper)
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HG Finance
Divisions: Faculty of Social Sciences > Economics
Library of Congress Subject Headings (LCSH): Economics -- Mathematical models , Competition , Loans , Businesspeople
Series Name: Warwick economics research papers series (TWERPS)
Publisher: Department of Economics, University of Warwick
Place of Publication: Coventry, UK
Official Date: March 2013
Dates:
DateEvent
March 2013Published
Volume: Volume 2013
Number: Number 1025
Number of Pages: 44
Institution: University of Warwick
Status: Not Peer Reviewed
Publication Status: Published
Date of first compliant deposit: 2 February 2017
Date of first compliant Open Access: 2 February 2017

Request changes or add full text files to a record

Repository staff actions (login required)

View Item View Item

Downloads

Downloads per month over past year

View more statistics

twitter

Email us: wrap@warwick.ac.uk
Contact Details
About Us