BORROWING BEHAVIOR OF THE PROPRIETARY FIRM: DO SOME RISK-AVERSE EXPECTED UTILITY MAXIMIZERS PLUNGE?

When a proprietor's liability is limited, borrowing behavior for an expected utility maximizer may vary widely. Proprietors with little to lose may rationally choose very large debt levels while others may choose to finance with 100% equity. This article presents a theory to explain these widely observed variations in behavior.


Issue Date:
1991-12
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/32606
Published in:
Western Journal of Agricultural Economics, Volume 16, Number 2
Page range:
251-258
Total Pages:
8




 Record created 2017-04-01, last modified 2017-08-25

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