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Jonathan Morduch hits the nail on the head about what is at the core of the social business paradigm: that we need to change the assumptions about the competitive relationship between company and consumer. Information asymmetries mean that capitalism as it is often fails to achieve market equilibrium.
In other words, because customers don’t have the information they need to make the right decisions, structures that perpetuate poverty persist, which is what Professor Muhammad Yunus pointed out at the Congressional Gold Medal Ceremony on Wednesday, April 17. And then, as he pointed out at later events, it’s not about being anti-capitalistic or anti-business. Social businesses are capitalistic, just in ways different than the traditional assumptions tend to accept.
What is the Impact of Muhammad Yunus?
Muhammad Yunus spoke to an overflowing crowd at NYU on April 15, an event jointly sponsored by the Wagner School of Public Service, Stern School of Business, and Financial Access Initiative.
Professor Yunus is known for fighting to improve the lives of millions of poor families around the world, the quest that was celebrated by the 2006 Nobel Peace Prize. These days there is a lot of talk about the impact of microcredit. But here was an opportunity to ask: what is the impact of Yunus? Given where we were, more specifically, how has Yunus changed the way we–economists, academics, policy makers and influencers–think about problems?