Topic: Dean Karlan
Making tiny loans to the poor may not create successful new businesses as often as once hoped. But it provides an unexpected benefit by supplying cash for other crucial needs such as schooling, health care – even food.
Contrary to the hype, microfinance doesn't help everyone – and microfinance loans sometimes go for personal needs, not a business. But that's OK.
Human nature hasn't changed, but the ease of indulgence – from food to credit cards to the Internet – has. The good news is that we can outsmart our impulses.