Barter Credit: Warehouses as a Contracting Technology

56 Pages Posted: 5 May 2020 Last revised: 28 Jul 2021

See all articles by Janis Skrastins

Janis Skrastins

Washington University in St. Louis

Date Written: April 7, 2021


A large Brazilian agribusiness lender introduces a new contracting technology: grain warehouses. Using runner-up warehouse locations as a control group, I find that lenders' access to these warehouses permits a new debt contract, i.e. a barter credit repayable in grain, increases borrowers' debt capacity and lowers borrowing costs. The effects are stronger when grain price risk is higher, for municipalities with weaker courts, and for financially-constrained borrowers. These findings are primarily consistent with barter credit reducing financial market imperfections by mitigating borrowers' output price risk.

Keywords: Organizational Design, Warehouses, Output Storage, Barter Credit, Price Insurance, Credit Enforcement

JEL Classification: D23, G32, G33, L22, L25

Suggested Citation

Skrastins, Janis, Barter Credit: Warehouses as a Contracting Technology (April 7, 2021). Journal of Finance, Forthcoming, Available at SSRN: or

Janis Skrastins (Contact Author)

Washington University in St. Louis ( email )

1 brookings drive
campus box 1133
st louis, MO St Louis 63130
United States


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