Agricultural Credit Policy
The restructuring of rural finance was a crucial instrument of agricultural market intervention during the post-1979 decade. Credit reached at least more than half of the peasantry, integrating a large group of small-scale producers in various markets (money, inputs, labour, agricultural products and consumer goods) from which they had been previously excluded. The development of very negative real interest rates during the 1980s meant that the interest rate for rural credit became a key factor not only at the macroeconomic level but also for the individual agricultural producer, sometimes superseding in importance the sales price of crops during periods of high inflation.
KeywordsInterest Rate Real Interest Rate Real Term State Farm Bank Credit
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