This unthinking encoding of thresholds feels like a 'Systems' problem that percolates into almost every part of life, whether its income brackets or hard limits on how many books you can borrow from the library. Some make more sense than others, just out of the sheer complexity and cost of implementing continuous (e.g. tapering) systems in the real world.

A particularly troublesome example I encountered, entirely unrelated to finance, was when working on a renal ward in hospital, we had to count respiration rate and input it into the obs machine, but if you inputted over 16, it would increase their sepsis score (or "acute deterioration"), meaning there'd be additional work to be done. It was rarely the case that they were actually producing symptoms of sepsis, but because of the hard threshold, to my horror, nurses would often just enter 16 on the mark, and juniors like me were told to do the same.

I'm sure there are literally tonnes of examples of these discontinuities and the bad incentives they produce across every industry and government function. In addition to laziness and inertia, I feel a general problem is that lack of curve/distribution/continuous-thinking in our schooling, as opposed to the easier discrete thinking.

All systems are fundamentally analog in nature. If only we just taught things this way...