Blackadder’s Lair

The home of many a cunning plan

Credit Confusion

As I write this, the Congress is preparing to pass a bill that would place restrictions on the ability of people to get credit. Personally, I have mixed feelings about the bill. On the one hand, when you make it harder for (mainly poor) people to get credit cards, you encourage them to turn to less savory means of obtaining credit. On the other hand, it’s at least arguable that some of the common irrationalities demonstrated by behavioral economics are present in the credit card market (whether the bill will actually address these problems is another story). And then there’s this.

But I don’t really want to argue about the credit card bill. Rather, I wanted to note an odd premise that both the pro and anti credit bill folks seem to be relying on in making their respective cases. Continue reading

May 20, 2009 Posted by | Economics | Leave a comment