The Economy of Promises: Trust, Power, and Credit in America
Today’s economy depends on promises as millions of borrowers commit to repay their loans: people borrow to buy houses, finance their education, and support household spending. Firms borrow to fund investment, finance inventory, or bridge gaps between revenues and expenditures. How do lenders decide whose promises to believe? Lenders weigh their uncertainty about the borrower’s future with the extent of their own vulnerability. Initially, lenders judged a borrower’s personal character and exploited...
Read more about Bruce Carruthers (Northwestern University)