A comprehensive and illuminating account of the history of credit in
America--and how it continues to divide the haves from the have-nots
The Economy of Promises is a far-reaching study of credit in
nineteenth- and twentieth-century America. Synthesizing and surveying
economic and social history, Bruce Carruthers examines how issues of
trust stitch together the modern U.S. economy. In the case of credit,
that trust involves a commitment by debtors to repay money they have
borrowed from lenders. Each promise poses a fundamental question: why
does the lender trust the borrower?
The book tracks the dramatic shift from personal qualitative judgments
to the impersonal quantitative measurements of credit scores and
ratings, which make lending on a much greater scale possible. It
discusses how lending is shaped by the shadow of failure, and the
possibility that borrowers will break their promises and fail to repay
their debts. It reveals how credit markets have been shaped by public
policy, regulatory changes, and various political factors. And,
crucially, it explains how credit interacts with economic inequality,
contributing to vast and enduring racial and gender differences--which
are only exacerbated by the widespread use of credit scores and ratings
for "big data" and algorithmic decision-making.
Bringing to life the complicated and abstract terrain of human
interaction we call the economy, The Economy of Promises is an
important study of the tangle of indebtedness that, for better or worse,
shapes and defines American lives.
