June 23, 2008

Marginal Revolution: Microfinance

Ryan Hahn asks:

In the case of microfinance, however, it seems to me the problem of limited liability is rearing its ugly head. Poor borrowers generally have little or no collateral, so they usually have little reason to avoid a strategic default.

It is a common myth that microfinance loans have no collateral.

Link Posted by Tim at June 23, 2008 06:34 PM | TrackBack