This Personal Insolvency Project (PIP) research report is divided into three parts and two volumes. The three substantive parts are set out in Volume I and relate to the research areas of: (1) debtor advice, (2) debtor education, and, (3) the credit environment. Volume II contains all of the appendices pertinent to the three sections and the bibliography.
Models of strategic interaction are common in the economic growth literature, as well as in many other fields. For example, in human capital spillover models of economic growth, your incentive to acquire human capital depends on the human capital of others. If spillovers take place within neighborhoods, then strategic interactions affect neighborhood formation, human capital of different ethnic groups, and overall inequality (Borjas 1993, 1996, Benabou 1993, 1996, Durlauf 2002, 1999, 1996). These models often feature multiple equilibria and sensitivity to initial conditions. Although the theory is well developed, there has been only limited empirical testing of strategic interactions and sensitivity to initial conditions.
One of the most famous models of strategic interaction in economics is Thomas Schelling’s (1971) elegant model of racial segregation (see its coverage in Dixit and Nalebuff 1991, for example). He shows how only a modest preference of whites to live next to other whites could result in nearly complete residential segregation, because of the instability of intermediate points where one agent’s residential location depends on the actions of other agents in the neighborhood. In this model, even a relatively small fraction of nonwhites could cause the neighborhood to “tip” from completely white to completely nonwhite. The fraction at which this happens is called the “tipping point.”
There is an undeniable mystique surrounding safes and vaults. Containers to safeguard valuables and secrets from theft and prying eyes have existed almost as long as the concepts of valuables and secrets themselves, and yet in spite of the “Internet age,” details of safes and the methods used to defeat them remain shrouded in obscurity and even a certain amount of mystery. Safe security is a delicate, almost perilous subject, protected by a near reverence that extends, in our imaginations at least, across both sides of the law. Safecrackers are perhaps the most romantic and “professional” of thieves, conjuring images of meticulously planned and executed exploits straight out of Hollywood screenplays. And among the law-abiding, safe and vault technicians (safe men in the traditional parlance) are perceived as an elite, upper echelon of the
