Truelift Steering Committee member, Alex Counts (President and CEO, Grameen Foundation) talks about behavioral economics as a lens to view poverty alleviation efforts. In particular, Alex discusses how the brain functions when it perceives scarcity. The findings he recounts are quite illuminating. Take a look at both parts in this two part series – they are definitely worth a read.
The following post was originally published on the Grameen Foundation Insights Blog. It’s the first part of Counts’ two-part post on scarcity and its implications for microfinance and poverty alleviation. Part two can be found here.
The field of behavioral economics – the intersection of psychology and economics – is fairly new. This is a partial explanation of why its lessons have not yet been applied much to microfinance and anti-poverty programs generally. But this is clearly changing, and none-too-soon, as microfinance in particular is in need of reinvention and rebranding.
In fact, I am coming to believe that thoughtful applications of behavioral economics can be a central part of defining and realizing the idea of “responsible microfinance” that the Microfinance CEO Working Group and others are championing and also “full financial inclusion” that moves the dial on…
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