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The Law and Economics of Secured Lending

The Law and Economics of Secured Lending

Author: Frederic Helsen
Publisher: Intersentia Publishers
ISBN: 9781839701504
Published In: June 2021
Format: Hardback
Jurisdiction: U.K. ? Disclaimer:
Countri(es) stated herein are used as reference only

$229.96

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Description
Contents

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How can it be that people and businesses are ever unable to obtain credit? Why do lenders not simply increase the interest rate for high-risk borrowers? And if increased interest rates can’t solve the problem, then surely pp>the use of collateral can?

As it turns out, things are not that simple. It seems that the laws of supply and demand do not fully apply to the credit market: low interest rates attract high demand, a part of which is never met, no matter what the interest rate. What is more, excessive interest rates seem to exacerbate the problem. Common knowledge holds that security interests provide at least a part of the answer, and yet economic theory has been ambiguous about them, to say the least.

This book provides an in-depth analysis of both the general economic theory of secured lending, as well as the very concrete and detailed aspects of the legal framework in which it takes place, in Belgium and the United States. Legal practitioners will find a deeper economic understanding of how credit works, and answers to legal questions that no traditional, inside-the-box legal handbook will ever ask. Economists will find theory applied to, and checked by, the legal reality in which they necessarily operate, down to minute detail.

Part I. Introduction

Chapter I. Basic Economic Problem and Search for a Legal Solution

Chapter II. Methodology

Part II. Economic Framework

Chapter I. Secured Lending Theory: Preliminary Questions on the Efficiency of Security Interests

Chapter II. Credit Rationing

Chapter III. Why is Credit Rationing a Problem?

Chapter IV. Beneficial Effects of Security Interests on Credit Rationing

Chapter V. Costs of Security Interests

Chapter VI. Normative Implications – A Functional Design of the Optimal Security Interest System

Part III. Legal Framework

Chapter I. Location in Research Methodology