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Across a wide range of contexts, small business owners in developing countries often leave profitable investments unexploited. 1 While credit constraints clearly exist in some contexts, they seem unlikely to fully explain the persistence of unexplained high return investments since even in the complete absence of credit markets, a standard Euler equation counterfactually implies that in the absence of other distortions firm owners with high returns to capital should have very high growth rates of consumption (ie Banerjee and Moll 2010). Some researchers have argued that behavioral factors explain the unrealized high returns, with most of the literature focusing on time preferences (ie Banerjee and Mullainathan 2010, Duflo, Kremer and Robinson 2011), or limited attention (ie Mani, Mullainathan and Shafir 2014). In this paper, we study the inventory decisions of Kenyan retail firms to provide evidence on what factors …