Authors: Md. Takibur Rahman, Md. Akhtaruzzaman Khan, Imranul Islam, and Madan Mohan Dey
Abstract
Trade credit (TC) is a more easily accessible financing source to the most small-scale aquaculture farms with limited access to institutional credit in the developing countries. However, it is often argued that TC is a drain, on one hand, and the gain, on the other hand, without quantifying and identifying sources of drain and gain. This study empirically examines the sources and size of benefits (gain) and costs (drain) of TC in aquaculture with a sample of 280 farms in Bangladesh using Stochastic Meta Frontier and Propensity Score Matching. Moreover, factors influencing the probability of having access to TC are explored using Probit regressions. TC enables financially constrained access to inputs, thereby avoiding production losses due to lack of capital. It also allows farms’ to use improved production technology with a positive tradeoff between benefits and costs.
Read the full publication at https://doi.org/10.1080/13657305.2023.2289936.
Published December 15, 2023
