The Psychological Lives of the Poor
AbstractAll individuals rely on a fundamental set of mental capacities and functions, or bandwidth, in their economic and non-economic lives. Yet, many factors associated with poverty, such as malnutrition, alcohol consumption, or sleep deprivation, may tax this capacity. Previous research has demonstrated that such taxes often significantly alter judgments, preferences, and decision-making. A more suggestive but growing body of evidence points toward potential effects on productivity and utility. Considering the lives of the poor through the lens of bandwidth may improve our understanding of potential causes and consequences of poverty.
CitationSchilbach, Frank, Heather Schofield, and Sendhil Mullainathan. 2016. "The Psychological Lives of the Poor." American Economic Review, 106 (5): 435-40. DOI: 10.1257/aer.p20161101
- D11 Consumer Economics: Theory
- D87 Neuroeconomics
- I14 Health and Inequality
- I32 Measurement and Analysis of Poverty
- J24 Human Capital; Skills; Occupational Choice; Labor Productivity