drnickbone comments on Post ridiculous munchkin ideas! - LessWrong

55 Post author: D_Malik 15 May 2013 10:27PM

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Comment author: drnickbone 16 May 2013 06:46:00AM 8 points [-]

This is called moral hazard. If the "suckers" who loaned you the money are "too big to fail" and in turn need bailing out, it is a form of negative externality.

Plenty of examples here in the recent financial crisis...

Comment author: CronoDAS 16 May 2013 06:53:57AM *  5 points [-]

This is called moral hazard.

Indeed it is!

Compare strategic default.