gailosaurus

There is a fair amount of evidence that poverty can cause poor decision-making due to the sapping of willpower. The more decisions you need to make throughout the day, the harder it is to think through them critically and make a good choice.

Imagine that you have some money, but you have 5 bills at home to pay with that money. You know you can't cover all the bills. Which do you pay? What are the consequences? Will your heat be shut off? Will you be evicted? How recently did you pay the previous bill? Who will be calling/sending notices/sending you to collections? How much interest will be added?

Also imagine that you work low-paying jobs as a single parent. You don't get a lot of time off, but now your young child is sick. Do you go to work and send your sick child to school? Do you try to call off when your manager will probably say no?

On top of this, you can't save. You can't look forward to vacations. You aren't sure you can make it through the month with a roof over your family's head, much less have some kind of long-term plan for improvement. You're most relaxing time of day is when the kids are in bed and you can watch television over a bowl of ice cream. At least THAT is the break you can look forward to. At least you can afford television and ice cream.

Then, after a day of many hard decisions, you are in the grocery store. You are mentally exhausted from your earlier decisions. You can look forward to only the small treats you can afford here. Are you going to weigh the cost-benefit of buying fresh food that you need to cook? What about generic vs. brand? How much should you get of your "treats"? What are the health implications of processed food?

The research does suggest that food (this is throughout the world, mind you) is one of the first things people splurge on because of this sort of mental exhaustion, combined with its affordability - it's a small purchase. But I'm sure you can predict the long-term effect: obesity, lack of forward-thinking and planning, etc.

Also, in general those who fall into poverty start to behave this way, while those who manage to break out of it stop behaving this way. This suggests that poverty is causal of the behavior - i.e. they aren't poor because they are lazy, fat, poor-planners; they are lazy, fat, poor planners because they are poor. Frighteningly, this would mean there is a good chance that if you or I became poor, we would fall into the trap. (Yes, there are people who don't, but I'm talking statistical probability)

I've read several different studies on this, but the ones that come to mind are out of Poor Economics by Esther Duflo and Abhijit Banerjee, for the curious.

For the record, no, I don't think people should waste money on lots of junk. Yes, you are an awesome person if you avoid the traps. But I think people looking in from the outside should try to understand what drives these decisions, because you will never be able to fix the problem if you don't understand the cause.

What do you think of the northern NJ market - close enough for NYC commute? We're buying right now, but it's very difficult to do.

I honestly thought they had made this when he said that.

I want to know this too...

Everyone who listened to you that day still thinks you are holding Terry Gross hostage in the back room.

The podcast where you described the reaction made me snort something unpleasantly out my nose from laughing. Partly because I am annoyed when she doesn't host, and partly because I like Radiolab more.