Export credit guarantees, moral hazard and exports quality

We analyse the role played by Export Credit Guarantees (ECGs) to encourage exports to developing countries. The existence of moral hazard on the side of the firm is introduced. We show that the inability of the exporter's government to verify the actual quality of the product will limit its ability to encourage trade through ECGs, once the coverage provided goes beyond a certain threshold. This result provides a rationale behind the limited coverage on ECGs.

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Year of publication:	2004
Authors:	García-Alonso, María del Carmen ; Levine, Paul ; Morga, Antonia
Publisher:	Canterbury : University of Kent, Department of Economics
Subject:	Exportgarantie \| Exportkreditversicherung \| Produktqualität \| Moral Hazard \| Theorie \| export credit guarantees \| offsets \| moral hazard

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Series:	Department of Economics Discussion Paper ; 04,02
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	386084963 [GVK] hdl:10419/68079 [Handle]
Classification:	G12 - Asset Pricing ; H56 - National Security and War ; L10 - Market Structure, Firm Strategy, and Market Performance. General
Source:	EconStor

Persistent link: https://www.econbiz.de/10010290639