Agent or Borrower? An Incentive of Moral Hazard with China Commercial Guarantee Company

Table 1

Payoff structure of bank and borrower.

	Bank	Borrower	Total payoff
𝑅≥𝐿(1+𝑖)−𝐶	𝐿(1+𝑖)	𝑅−𝐿(1+𝑖)	𝑅
𝑅<𝐿(1+𝑖)−𝐶	𝑅+𝐶	−𝐶	𝑅