IDEAS home Printed from https://ideas.repec.org/a/vrs/zerpae/v378y2024i1p1-29n1004.html
   My bibliography  Save this article

Evaluation of the Effects of Replacing the Wibor Rate by the Wiron Rate for Preferential Credits in Polish Agriculture

Author

Listed:
  • Kagan Adam

    (DEng, Institue of Agricultural and Food Economics National Research Institute; ul. Świętokrzyska 20, 00-002 Warsaw, Poland.)

  • Soliwoda Michał

    (DEng, University of Lodz; ul. Narutowicza 68, 90-136 Łódź, Poland.)

  • Gospodarowicz Marcin

    (DSc, Assoc. Prof. of Warsaw School of Economics, Warsaw School of Economics; al. Niepodległości 162, 02-554 Warsaw, Poland.)

Abstract

The aim of the article is to present an assessment of the economic effects of replacing the WIBOR rate with the WIRON rate for preferential credits in Polish agriculture. The study is an in-depth case study and uses the simulation analysis method. The introduction of the WIRON 3M rate will result in a reduction in the interest rate on preferential credits granted in the future, and the nominal scale of the discount will depend on the phase of monetary policy in the country and the level of the applicable interest rates set by the National Bank of Poland (NBP). However, in the case of credits granted according to the currently applicable mechanism (interest rate based on WIBOR 3M) or the promissory note rediscount rate, the change will most likely be neutral. The largest part of the interest rate reduction in all phases of the monetary policy cycle is obtained by borrowers (farmers) using credit lines: RR (credits for investments in agriculture and inland fishing, Z (credits for the purchase of agricultural land) and most activities financed under the PR line (credits for investments in the processing of agricultural products, fish, crustaceans and molluscs, as well as the purchase of stocks and shares). In the case of disaster loans granted to insured borrowers, the only beneficiary of the index change will be the State Treasury. Quantifying the potential savings for borrowers in the agricultural sector related to changes in reference rates is not easy due to the scarcity of the available detailed data.

Suggested Citation

  • Kagan Adam & Soliwoda Michał & Gospodarowicz Marcin, 2024. "Evaluation of the Effects of Replacing the Wibor Rate by the Wiron Rate for Preferential Credits in Polish Agriculture," Zagadnienia Ekonomiki Rolnej / Problems of Agricultural Economics, Sciendo, vol. 378(1), pages 1-29.
    • Handle: RePEc:vrs:zerpae:v:378:y:2024:i:1:p:1-29:n:1004
    DOI: 10.30858/zer/181137
    as

    Download full text from publisher

    File URL: https://doi.org/10.30858/zer/181137
    Download Restriction: no
    File URL: https://libkey.io/10.30858/zer/181137?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Keywords

    financial intervention in agriculture; preferential credits in Polish agriculture; WIBOR; WIRON; agricultural finance;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:vrs:zerpae:v:378:y:2024:i:1:p:1-29:n:1004. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.sciendo.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.