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Interesting example of the endowment effect from New York Times restaurant critic Frank Bruni: http://www.nytimes.com/2009/08/19/dining/19note.html?8dpc
Summing up the quirky behaviors of his dining companions over his tenure as restaurant critic for the NY Times, Bruni describes the way his fellow diners--to whom he had randomly assigned dishes to be sampled--would become protective of "their" choices, defending their quality.
We just completed the baseline survey for one of the projects I’m working on in Cagayan de Oro, the Philippines. Consequently, I’ve been spending most of my time the last few weeks thinking about how to get good data. Getting the right information might seem simple; figure out what you want to know about people and then ask them. However, in practice getting good data proves much more difficult.
Banks in the developed world know a lot about applicants before deciding whether or not to lend them money. The transactions take place within a massive flow of detailed financial information including tax returns, credit scores, loan applications, and bank statements. An ocean of personal data follows people throughout their lives and determines their access to credit.
A recent post from Alex in the Philippines addressed the common uses of microfinance loans, which leads logically to two follow-up questions. How do we actually know with any certainty what microfinance clients do with their loans given that money is fungible? And, secondly, should we care as long as the loans are paid back?
A frequent question that I get from friends and family members about the microfinance projects I work on for IPA is, “What do people actually do with the loans?”
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