Behavior And Incentives

photo by Gary Bendig, via Unsplash

“It is harder to ignore the enormous increase in indebtedness and overhead that has accompanied the enlargement of farm technology. Mr Billard quotes an Iowa banker: “In 1920 … $5,000 was a big loan, and people hesitated to borrow. Now a $40,000 loan is commonplace, and having mortgage after mortgage is an accepted thing. I occasionally wonder whether the average farmer will ever get out of debt.” …

… The Iowa banker’s statement, doubtful as it may seem out of context, is made in praise of credit. Nowhere is there a question of the advisability of basing so large on enterprise on credit, or of the influence of routine indebtedness on a people’s character. Nowhere is there a suspicion that there might be any worth in the old rural values of solvency and thrift.”

photo by Debby Hudson, via Unsplash

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