A new form of lending using digital collateral has recently emerged, most prominently in low and middle income … countries. Digital collateral (DC) relies on "lockout" technology, which allows the lender to temporarily disable the low value … of the collateral to the borrower without physically repossessing it. We explore the effect of this new form of credit …

We study the design of macroprudential policies based on quantitative collateral-constraint models. We show that the … desirability of macroprudential policies critically depends on the specific form of collateral used in debt contracts: While … inefficiencies arise when current prices affect collateral---a frequent benchmark used to guide policies---they do not when only …

Collateral requirements play an important role in credit markets. This paper shows that the endowment effect … as collateral. Using a field experiment in Kenya, we show that borrowers instead strongly prefer loans collateralized … valued before ownership. Our findings imply that assets which are difficult to use as collateral--which cannot be financed by …

We show that borrowers are highly sensitive to the requirement of posting their homes as collateral. Using … above which households must post their residence as collateral. One-third of all borrowers select the maximum … amount to avoid collateral. Exploiting time variation in the loan amount threshold, we find that collateral causally reduces …

collateral constraint. It shows that for plausible parameter configurations, the economy has a unique equilibrium exhibiting …

economy slows, or average credit spreads widen. This contingent valuation of collateral or security, coupled with the borrower …