We examine the relationship between the small business loan guarantee and the agency problem of small firms. We then recommend financial instruments or financial contracts that can minimize of eliminate the moral hazard problem.
Loan Guarantee, Small Business Lending, Agency Problem, Risk, Small Business, Moral Hazard
So, Jacky C.; Bharati, Rakesh; and Crain, Susan
"Risk-Taking, Agency Problem, and Small Business Loan Guarantee: An Application of Option Pricing Theory,"
The Journal of Entrepreneurial Finance:
1, pp. 24-43.
Available at: http://digitalcommons.pepperdine.edu/jef/vol6/iss1/3