Ideas like paternalistic libertarianism are en vogue these days. You’ve read about them in books like Nudge, Freakonomics and Predictably Irrational. It’s all part of the attack of the behavioral economists, a band of economists who believe that traditional economic modeling is based on humans that are fundamentally not human,…
What’s the Sweet Spot for Green Dot?
Last week our friends at Green Dot finally filed for an IPO. This is exciting news in a recessionary environment, but especially for a company which has seen significant growth during this recession. Green Dot’s revenues have roughly doubled every year since 2007, as did their operating income. The JP…
Just-in-time learning
When I explain my day-job, quite a few people believe that the way to solve the underbanked “problem” is through financial education. Many banks think the same way. They are right, of course. But it’s not so simple as just teaching “these people” how basic financial services work (never…
Savings Lottery
Peter Tufano at HBS has been doing research on savings based lotteries for a while. The basic idea is that lots (generally poorer) people buy lottery tickets – the average American household spends $500 per year on lottery tickets – and it is a well known fact that we don’t…
Cap and Trade
For quite a while I’ve been thinking about the similarities between CFSI’s perspective on using market forces to mitigate poverty and the green movement. Both are double bottom line enterprises – with the ability to yield profit and social returns – which address complex, system problems, with material vested interests…
Why the underbanked
When thinking about the underbanked, it’s easy to assume there are people at the bottom of the economic pyramid who are generally underserved. What’s not so obvious is what appears as a small fringe of financially disenfranchised people, is actually a very large consumer market: over 100 million adults strong in…