Cognitive effects of poverty

A new paper by Anandi Mani, Sendhil Mullainathan, Eldar Shafir, and Jiaying Zhao shows some pretty profound effects of poverty on cognition and decision making. The paper says that poverty is equivalent to pulling all-nighters in terms of its effect on your ability to perform routine tasks and make good decisions. It reminded me of a conversation I had with Mark Hecker, director of Reach, Inc., a nonprofit working on literacy in DC, about children who’ve been abused. He asked me to think about that feeling of indigence and anger that shoots up when someone bumps into you. It’s startling, difficult to process, and affects everything we do next. Children who’ve suffered abuse feel that way all the time, which puts additional stress on them to make good decisions, to concentrate in school, and more.

It’s a good reminder that putting ourselves in someone else’ shoes is often impossible; someone who has grown up middle class never worrying about money is not going to approach large expenditures the same way that someone who grew up poor will. Analyzing decision making of poor and disadvantaged individuals is subject to so many more constraints that we realize.