Also, (I'm speculating here, since I wasn't alive back then) but bankruptcy was very stigmatized. I won't know the extent, but the way my parents talk about it,

Also, (I'm speculating here, since I wasn't alive back then) but bankruptcy was very stigmatized. I won't know the extent, but the way my parents talk about it, bankruptcy just didn't seem like an option. They say it was akin to paying a vet to euthanize your dog rather than suffocating it- it's cheaper one way, but the outcome is the same. It's easy to be "rational" as armchair economists, but social norms and pride are a very important driver. It's what baffles real economists when they gripe "our models would work, if the world were rational!"