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"The key question here is whether the borrowers prone to rollovers are systematically overoptimistic about how quickly they will repay their loan." Why is that the key question? Why is it even a relevant question? Buyers of iPhones might be systematically overoptimistic too. So what? Without a robust theory of "reform," explaining under what circumstances and for what reasons a "reform" is justified, how can any question be selected as "key"?
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Dec 21, 2014