> 15%/month didn't sound that bad to her
This is why when economists talk about consumers acting as rational market participants I just laugh and shake my head.
Have they met people?
This is why when economists talk about consumers acting as rational market participants I just laugh and shake my head.
Have they met people?
This isn’t someone deciding between 15% monthly and a nice 4% annual personal loan. This is someone deciding between 15% monthly and homelessness. Choosing the interest rate is rational.
If she's not able to pay back the loan, she will be killed and her family is responsible for paying it back. The amount of undocumented suffering in the poor world right now is huge.
The import of behavioral econ. definitely remains understated today. I am also interested in philosophical thinkers, like Elizabeth Anderson or Michael Sandel, that take questions like these and explore the implications that they might have for how we ought to structure society.