A collaborative study from researchers at Princeton University, the University of Warwick, and Harvard University have studied the effects of scarcity on decision making and cognitive function, and their findings may change the way we tackle issues of poverty.
Published in the journal Science, the study presents a unique perspective regarding the causes of persistent poverty. The researchers suggest that being poor may keep a person from concentrating on the very avenues that would lead them out of poverty. A person’s cognitive function is diminished by the constant and all-consuming effort of coping with the immediate effects of having little money, such as scrounging to pay bills and cut costs. Thusly, a person is left with fewer “mental resources” to focus on complicated, indirectly related matters such as education, job training and even managing their time.
In a series of experiments, the researchers found that pressing financial concerns had an immediate impact on the ability of low-income individuals to perform on common cognitive and logic tests. On average, a person preoccupied with money problems exhibited a drop in cognitive function similar to a 13-point dip in IQ, or the loss of an entire night’s sleep.
"Previous views of poverty have blamed poverty on personal failings, or an environment that is not conducive to success," she [corresponding author Jiaying Zhao] said. "We’re arguing that the lack of financial resources itself can lead to impaired cognitive function. The very condition of not having enough can actually be a cause of poverty."