Certainty Premiums and Cognitive Loads
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The intersection of behavioural economics and microfinance has created an exciting subfield of studies. So too has the attention brought by the community of empirical political scientists to the effects of conflict on countries. This chapter critically examines the major works of each field, as relevant for an examination of microfinance in conflict, and highlights the overarching recommendations made by many for greater precision in empirical work. Taking the financial development literature apart for a closer look at what happens during conflict, a narrative is presented of decreasing demand and relevance for microfinance services during conflict. The chapter lays the groundwork for the significant practical challenges related to empirically measuring the anecdotal evidence. Moreover, it paves the way to engaging with these issues, and the current conversation, in a constructive and holistic way.