Good Intentions Pave the Way to ... the Local Moneylender

Microborrowers may take usurious loans to repay a loan taken from a micronance institution because of having neglected the time inconsistency of optimal plans or having discounted future payoffs too strongly from the ex-post perspective. Microfinance programs should strive at preventing such consequences of bounded rationality.

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Year of publication:	2012-09
Authors:	Arnold, Lutz G. ; Booker, Benedikt
Institutions:	Wirtschafts- und Sozialwissenschaftliche Fakultät, Friedrich-Alexander-Universität Erlangen-Nürnberg
Subject:	microfinance \| hyperbolic discounting

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Extent:	application/pdf
Series:	Working Papers.
Type of publication:	Book / Working Paper
Notes:	Number 126 9 pages
Classification:	G21 - Banks; Other Depository Institutions; Mortgages ; D91 - Intertemporal Consumer Choice; Life Cycle Models and Saving
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010570877