Person:
Sanchez, Susana M.

Macroeconomics, Trade, and Investment Global Practice, Africa
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Author Name Variants
Fields of Specialization
Growth determinants, Poverty, Financial markets, Labor markets, Small and medium enterprise development
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Macroeconomics, Trade, and Investment Global Practice
Africa
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Last updated January 31, 2023
Biography
Susana Sanchez is the senior country economist for The Gambia in the Macroeconomics, Trade, and Investment Global Practice of the World Bank. She is currently based in Washington, DC. She has conducted research on growth determinants, financial markets and poverty, labor markets, and small and medium enterprise development, and has also led technical and advisory work on access to finance issues in Mexico, Brazil, El Salvador, Guatemala, Turkey, and Romania. 

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    Credit Constraints and Investment Behavior in Mexico’s Rural Economy
    ( 2009-08-01) Love, Inessa ; Sanchez, Susana M.
    This paper uses two recently completed surveys of individual entrepreneurs (farmers and microentrepreneurs) and registered enterprises (agricultural and nonagricultural) operating in Mexico s rural sector to provide new evidence about the factors influencing the incidence of credit constraints and investment behavior. To measure the incidence of credit constraints, the authors use self-reported information on whether economic agents have a demand for loans, separating formal and informal markets. They define credit constraints as a situation where rural agents report an unsatisfied demand for loans (formal or informal), which originates from rural agents having projects that are too risky or from impediments hindering the ability of rural agents and lenders to reduce information asymmetries. The authors find that the self-reported demand for loans is low. Nevertheless, the incidence of credit constraints is pervasive, especially among individual entrepreneurs. The low use of loans has consequences for the amount of investments that occur in the rural economy, posing a major obstacle to Mexico s convergence towards its NAFTA partners. The empirical analysis, which includes proxies of business prospects and creditworthiness, shows that improving the availability of loans to credit constrained agents would increase the number of agents making investments and their investment to capital ratios.