SHAH A K Flashcards
What are the two reasons for the poor engaging in behaviors that reinforce poverty?
- Personality traits: resource scarcity creates a specific mindset, altering decision-making and focus
- Circumstances of poverty: Socioeconomic and political environments foster such behaviors
explain the core idea: having less elicits greater focus
they will focus more on what they don’t have which leads to neglecting of other important issues: they will borrow excessively etc, without considering LT consequences
what did they do, like what kind of experiment
five experiments where participants were categorized as poor or rich
experiment 1: wheel of fortune, Rich” participants had more guesses than “poor” ones, what happened:
Poor participants performed worse because scarcity increased their focus on the current problem, leading to fatigue and depletion
experiment 2: Angry Birds” with varying budgets for shots
Poor participants became highly engaged, leading to better performance per shot.
However, over-engagement led them to overborrow for future rounds, neglecting long-term outcomes.
they thought about short term instead of longterm
experiment 3: “Family Feud” with limited time or borrowing options
Regardless of the interest rate, poor participants borrowed a greater portion of their budgets.
They performed best when borrowing wasn’t allowed and worst when borrowing incurred interest
experiment 4: The “Family Feud” experiment was modified to create debt in subsequent rounds
Poor participants borrowed a higher proportion of their budgets and failed to adjust borrowing strategies as they accumulated debt
experiment 5: Participants again played “Family Feud,” but some could preview subsequent rounds
Rich participants benefited from previews by borrowing less, while poor participants continued to overborrow due to their focus on immediate needs.
so conclusion?
poor people focus more on current needs at the expense of future needs (overborrowing).
