Here is a chart from the JEL showing that the much-praised Grameen Bank is a highly subsidized, unprofitable, and unsustainable institution. I have a piece on this subject coming out tomorrow but I was just visiting with BK Marcus on the subject of why is it that so many otherwise libertarian writers were so quick to buy into the Nobel Prize rhetoric about how Grameen is using the magic of credit to the poor as a means of social uplift. BK said it was because libertarians generally overvalue the idea of universalized individual entrepreneurship and undervalue the role of wages and large-scale capital in driving economic growth. Could be: but I still don’t entirely understand why so many writers and thinkers on the market side of the debate didn’t smell a rat here, especially when the subject has been so well exposed on the scholarly literature. In any case, more tomorrow.
Grameen is a bust
