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The Oppressive Psychology of Poverty

October 21, 2012, 5:06 PM
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What's the Latest Development?

How will the nation's psychological character change as the middle class loses the financial comfort it was once able to take for granted? The changes will not be pleasant, warns Harvard economics professor Sendhil Mullainathan. "When faced with financial scarcity, people’s minds keep coming back to concerns such ashow will I pay rent this month," Mullainathan said. The essential psychological difference among the poor is that, when it comes to worrying about finances, there is no relief from the magnitude and intensity of the problem. 

What's the Big Idea?

Unlike the stress that results from an overbooked schedule, poor families cannot take a vacation from being poor. "You and I can be busy and we take a vacation from work. You can’t take a break from being poor. You can't say, 'Hey I've had enough of worrying about money, I'm just going to be rich for a couple of weeks until I've recovered,'" Mullainathan said. Poor people also have a smaller margin of error when it comes to making financial mistakes. "He said we all make mistakes, the only difference is that some people have the slack to make them and not suffer the consequences."

Photo credit: Shutterstock.com

 

 

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