"The efficiency of microcredit is something like the capillary action of a paper towel absorbing liquid. The economic structure of a community is like a paper cloth - people connected by commerce. The difference is, as money enters the fabric of economy, it actually creates more money. Say a woman has money to buy material and sells clothing at a market. The woman then brings back cash to her village, buys food and other essentials for her family. Money gets absorbed, spreads around, and soon more people have cash to spend and invest."Can you figure out how many economic concepts in the above quotes? If you watch the movie and pay attention with the graphical illustration on how the velocity of microcredit circulation works, then you will be amaze. I hope so, if you like (read: study) economics...
Saturday, December 15, 2007
Quote of the day: On Microcredit
I study economics, that is why I love the following quote on "The Velocity of Circulation" from the episode of serial Numb3rs - Money for Nothing - as follow: