Why can not households save the way out of credit constraint

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Problem

1. If given enough time, why can't households save their way out of credit constraints?

2. Should facilitating micro saving precede microcredit and not the other way around?

3. Crop insurance programs have often failed or have cost governments heavily. Spell out the main advantages and disadvantages of instead directly insuring farmers against bad weather. Describe contexts in which it seems like a better prospect, and places in which it seems less likely to be a winning idea.

Reference no: EM131916087

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