The Relationship Between Financial Services and Perceptions of Government

• In Event: The Politics of the Credit Welfare State: Access, Inequality, and Democracy

Abstract

Driving through low-income neighborhoods, financial services such as pawnshops, check-cashing stores, rent-to-own stores, and payday loans dominate each block. These services, collectively known as the fringe economy, constitute a separate economy for low-income residents and those with poor credit. Using the intuition of policy feedback theory, I argue that experiences with fringe financial services can shape an individual’s perception of government. I develop this argument through interviews with fringe economy users and non-users in Philadelphia, PA and Chicago, IL. These states vary in the extent to which they restrict fringe economy activity. This cross-case comparison privileges everyday experiences and first-hand assessments of different financial services in the fringe economy. This research sheds new light on classic questions of American political behavior by tracing how individuals experience an alternative economy.

Author

• Patricia Posey, University of Chicago