Reviews for Consumer Credit in the United States: A Sociological Perspective from the 19th Century to the Present

The average rating for Consumer Credit in the United States: A Sociological Perspective from the 19th Century to the Present based on 2 reviews is 3.5 stars.

Review # 1 was written on 2009-06-28 00:00:00 Anita Gift Trillions of dollars in handout aid in the 20th century to the developing world has failed miserably in the 20th century. One recently popular solution that promises to change this dismal record is microcredit. Many will have heard about microcredit before, Smith and Thurman craft a very straight-forward non-jargon manual on microcredit. They tell many stories of many lives improved by microcredit. In the appendix section, the authors demonstrate a pretty simple calculation of cost per lives impacted (CPL). Importantly, this formula has a multiplier in the denominator for how many times the microloan is reloaned. This is the reason why microcredit can have a much larger and much more sustainable effect on solving poverty than traditional forms of aid. More specifically, taking into account calculation criticisms of some banking experts, the authors hypothetically come up with a CPL for microlending of 6% of the avg income of a developing world. Taking numbers from: "In the Democratic Republic of Congo, the average income is $120, so the CPL would be 1-10% of that or $1.20 to $12. Wow! It is an order of magnitude (10x) more expensive in middle income countries (e.g. Eastern Europe) and two orders of magnitude (100x) more expensive in developed countries. So, if you are looking for maximizing your CPL...low income countries are the best investment by far." One important point the authors made is that making microloans in developing countries is many times more impactful because a $10 income change means a lot more than it does in the United States. In Muhammed Yunus's book Banker to the Poor, he argued that microcredit would work in poor areas of the United States as well as it has in Bangladesh and other developing regions. However, this did not seem logical at all. If I loaned $100 to an unemployed person, no matter how entrepreneurial, that money would not go as far. Though exceptions are many, the costs of entry for businesses to enter a market in developed nations are much higher than can be financed by microloans. Thus, I appreciated that Smith and Thurman made this distinction. One glaring issue not addressed in the authors' whole-hearted recommendation of microloans as the solution for poverty is that access to capital is only one contributor to destitution. The authors appreciate that many other social-political factors play a role, but insist that microcredit is a "broad spectrum antibiotic" that can address all the problems. But what about the HIV epidemic in sub-Saharan Africa? What about the need for anti-RV drugs in Haiti? Raising the incomes of many individuals can still not make up for the lack of a medical and educational infrastructure. I believe certain aid still needs to remain as a charity, such as medicines, supplies, construction of schools. Overall, the book is a well-written, good practical overview of microcredit and why it holds the promise of dramatically reducing the number of people in the world in extreme poverty.

Review # 2 was written on 2007-11-06 00:00:00 Dan Pope The authors present a business person's introduction to microcredit and outline reasons why this form of aid is one of the most successful ways to fight poverty. Although I already understood some basics of microcredit loans, the book gave me more background and history of the microfinance movement. The authors seemed to write for a affluent audience looking for ways to enter into philanthropy, rather than for a broader audience including those with more modest incomes. This surprised me because, "the smaller the loan, the bigger the impact." Still, with the upcoming holidays sparking the spirit of giving, this book is a wonderful place to begin researching where and how to donate.