Friday, January 20, 2012

The psychology of poverty

Despite the title, the habits John Cheese describes in The 5 Stupidest Habits You Develop Growing Up Poor aren't really stupid. Human beings in any environment do not operate by "rational" thought, i.e. thinking through the consequences of every possible action in every situation, and picking the action that will result in the best outcome. Instead, people develop habits of thought, and then pick the most applicable habit to each situation and act accordingly. Rationality is, I think, more applicable to evaluating our habits: does this habit usually lead to a moderately good outcome; if it does not, the rational response is adjust the habit.

The habits that Cheese describes are, when you're poor, actually rational, in that they usually lead to a moderately good outcome, and the habits that middle- and upper-class people develop would typically be disastrous. When you're poor, according to Cheese, you're always facing critical-priority expenses. You don't buy a new dryer when it's on sale because your car needs a new transmission that month. The only thing you buy in bulk is food, because transaction costs (driving to the grocery store) dominate food shopping. (Also, I suspect that, like me, a lot of poor people buy prepared food because they work a lot, at physically demanding jobs; cooking takes time, energy, and attention that's already in short supply.)

What Cheese means by "stupid", I think, is that when poor people suddenly become slightly less poor, it's hard to abandon the rational habits they learned and developed to survive poverty, but have become counterproductive in their new environment. But that's more-or-less how habits have to work; the propensity to behave in a certain way that is easily abandoned will not serve as a survival strategy, especially under stress.

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