causes of poverty, economics, poverty

The Causes of Poverty (78): High Discount Rates and Lack of Delayed Gratification

grasshopper & ants

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You talk to conservatives about the reasons why poor people are poor, and chances are that the discussion turns to lack of self-control, high discount rates and inability to delay gratification. “High discount rates” means that things in the present or near future are viewed as having a higher payoff than things in the distant future. If you have a high discount rate, you focus on immediate gratification. This in turn shows up in low savings rates, high debt, obesity, teen pregnancy, drug use, high drop out rates, low school attendance and other vices supposedly common among the poor.

Some even argue that differences between people in the apparent levels of self-control, discount rates or time preferences – which is all the same thing – appear at a very early age and are therefore probably innate. The famous marshmallow test will then get a favorable citation: you give kids a marshmallow and tell them they can either eat it now or, if they wait a few minutes, have two marshmallows. Kids who wait do better later in life.

However, recent studies have suggested that the marshmallow test does not, in fact, reveal innate (in)ability. The environment in which tests such as these take place determines to a large extent the levels of self-control revealed through them. Whether or not people are capable of delayed gratification depends not on their abilities but on their assessment of the reliability of the world around them. When the world is not worthy of trust, the best course of action is often to live for today.

This attitude towards the world and the future is probably internalized from a young age onward, which makes it hard to change. What it takes is to offer young children a reliable environment allowing them to develop levels of trust which will in turn yield low discount rates and the ability to delay gratification later in life. But in order to do that we’ll need to reduce parental poverty. Claims about lack of self-control as a cause of poverty then have things completely backward. Rather than a cause we’re dealing with an effect of poverty.

More posts in this series are here.

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causes of poverty, economics, poverty

The Causes of Poverty (71): Poverty of Willpower and of Self-Control, Revisited

marshmallow test

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Almost as old as the problem of poverty itself is the story that poverty is caused by insufficient self-control and willpower. Never mind that things may just as well be the other way around: poverty drains the will. And never mind that the most famous study cited by proponents of the willpower story is apparently misleading:

For the past four decades, the “marshmallow test” has served as a classic experimental measure of children’s self-control: will a preschooler eat one of the fluffy white confections now or hold out for two later? … The research … began at Stanford University in the late 1960s. Walter Mischel and other researchers famously showed that individual differences in the ability to delay gratification on this simple task correlated strongly with success in later life. Longer wait times as a child were linked years later to higher SAT scores, less substance abuse, and parental reports of better social skills.

Because of the surprising correlation, the landmark marshmallow studies have been cited as evidence that qualities like self-control or emotional intelligence in general may be more important to navigating life successfully than more traditional measures of intelligence, such as IQ.

The Rochester team wanted to explore more closely why some preschoolers are able to resist the marshmallow while others succumb to licking, nibbling, and eventually swallowing the sugary treat. The researchers assigned 28 three- to five-year-olds to two contrasting environments: unreliable and reliable. The study results were so strong that a larger sample group was not required…

Children who experienced unreliable interactions with an experimenter waited for a mean time of three minutes and two seconds on the subsequent marshmallow task, while youngsters who experienced reliable interactions held out for 12 minutes and two seconds. Only one of the 14 children in the unreliable group waited the full 15 minutes, compared to nine children in the reliable condition.

“I was astounded that the effect was so large,” says Aslin. ” … You don’t see effects like this very often.” …

The findings, says Kidd, are reassuring. She recalls reading about the predictive power of these earlier experiments years ago and finding it “depressing.” At the time she was volunteering at a homeless shelter for families in Santa Ana, California. “There were lots of kids staying there with their families. Everyone shared one big area, so keeping personal possessions safe was difficult,” she says. “When one child got a toy or treat, there was a real risk of a bigger, faster kid taking it away. I read about these studies and I thought, ‘All of these kids would eat the marshmallow right away.’ “

But as she observed the children week after week, she began to question the task as a marker of innate ability alone. “If you are used to getting things taken away from you, not waiting is the rational choice. Then it occurred to me that the marshmallow task might be correlated with something else that the child already knows—like having a stable environment.” (source, source)

More posts in this series are here.

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causes of poverty, economics, health, poverty

The Causes of Poverty (59): Stress

stress

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Stress is often a consequence of poverty, but it can also make poverty worse. Esther Duflo and Abhijit Banerjee have noted in Poor Economics that

[t]here is a strong association between poverty and the level of cortisol produced by the body, an indicator of stress. Conversely, cortisol levels go down when households receive help. The children of the beneficiaries of PROGRESA, the Mexican cash transfer program [later renamed Oportunidades], have, for example, been found to have significantly lower levels of cortisol than comparable children whose mothers did not benefit from the program. (source)

Cortisol is a hormone, and high levels of it can cause brain dysfunctions which in turn make it difficult for affected individuals to escape their economic predicament.

The prefrontal cortex, for example, which is vital for suppressing impulsive responses, is rendered less effective by high cortisol levels, making us more likely to take hasty, ill-considered decisions. “When experimental subjects are artificially put under stressful conditions,” Duflo and Banerjee note, “they are less likely to make the economically rational decision when faced with choosing among different alternatives.” (source)

This poverty cycle or poverty trap can only be broken when external interventions reduce stress levels. For example, poor people can be given easier access to credit or insurance, which will reduce their fear of the future. They can be given a basic income. Etc. Perhaps cortisol-reducing medication is also an option.

More here on the way in which brain dysfunctions can cause poverty. And more here on the link between poverty, self-control and willpower. More posts in this blog series are here.

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causes of poverty, economics, poverty

The Causes of Poverty (46): Poverty of Willpower and of Self-Control

self-control

(source)

Conservatives often argue that the absence of certain mental goods such as self-control and willpower are to blame for the absence of material goods: poverty of the mind and of the will leads to material poverty. Now it seems that things are actually the other way around. Psychological experiments have shown that

an individual’s capacity for exerting willpower [is] finite—that exerting willpower in one area makes us less able to exert it in other areas. … After you exert self-control in any sphere at all, like resisting dessert, you have less self-control at the next task. (source)

That’s a general rule, but also one which affects the poor disproportionately: their material poverty forces them to exercise self-control and willpower much more frequently and intensely. They therefore deplete their mental “stock” much more rapidly, and as a consequence lose the necessary mental powers in situations where they need them most. This in turn, makes their material poverty worse or at least more difficult to overcome.

The basic process have been shown over and over again in simple experiments. Here’s one:

[F]ood-deprived subjects sit at a table with two types of food on it: cookies and chocolates; and radishes. Some of the subjects were instructed to eat radishes and resist the sweets, and afterwards all were put to work on unsolvable geometric puzzles. Resisting the sweets, independent of mood, made participants give up more than twice as quickly on the geometric puzzles. (source)

This makes intuitive sense:

Purchasing decisions that the wealthy can base entirely on preference, like buying dinner, require rigorous tradeoff calculations for the poor. … [P]overty appears to [make] economic decision-making more consuming of cognitive control for poorer people than for richer people. … In one experiment, poor participants in India performed far less well on a self-control task after simply having to first decide whether to purchase body soap. …  [I]f you have enough money, deciding whether to buy the soap only requires considering whether you want it, not what you might have to give up to get it. (source)

work

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This leads to some profound philosophical questions. Poverty seems to reduce free will, making it hard for the poor to use their own mental powers as means to escape their circumstances. However, if that is the case, we’ll be tempted to adopt some form of classism, blaming the poor rather than the economic and social structures they live in, the economic ups and downs that determine their job prospects, the discrimination some of them face, the politics and laws they endure etc. And then we’ll be right back where we started, with the conservative criticism of poverty discourse. The poor become a lesser form of humans, devoid of some of the essential human characteristics such as free will, self-control, intelligence etc.

However, the basic logic of the self-control argument remains persuasive, as long as one doesn’t focus too much on it at the expense of other causal explanations. The logic is also reminiscent of another causal theory, namely the bee sting theory of poverty. Both theories focus on the psychological causes of poverty:

A person with one bee sting is highly motivated to get it treated. But a person with multiple bee stings does not have much incentive to get one sting treated, because the others will still throb. The more of a painful or undesirable thing one has (i.e. the poorer one is) the less likely one is to do anything about any one problem. Poverty is less a matter of having few goods than having lots of problems.

If, for example, our car has several dents on it, and then we get one more, we’re far less likely to get that one fixed than if the car was pristine before. If we have a sink full of dishes, the prospect of washing a few of them is much more daunting than if there are only a few in the sink to begin with. …

[B]eing poor is defined by having to deal with a multitude of problems: One doesn’t have enough money to pay rent or car insurance or credit card bills or day care or sometimes even food. Even if one works hard enough to pay off half of those costs, some fairly imposing ones still remain, which creates a large disincentive to bestir oneself to work at all. (source)

More posts in this series are here.

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democracy, globalization, justice, philosophy, what is democracy?

What is Democracy? (46): The Boundary Problem

Most discussions about democracy take one thing for granted: that the composition of the group of people who (have to) govern themselves democratically is already fixed. The topics discussed are:

  • how can these people govern themselves democratically, or more democratically?
  • which procedures, institutions or voting systems should be used to guarantee the highest level of democracy?
  • is representative democracy best, or should there be some kind of direct democracy?
  • which are the prerequisites for an adequate or perfect democracy (education, free speech etc.)?
  • what happens to the minorities within this group of people?
  • etc.

What is forgotten in all such discussions is that the composition of the group of people governing themselves democratically has an enormous importance. This composition is of course established by boundaries or borders. These boundaries are prerequisites for any democratic decision: before such a decision is possible or even conceivable, there has to be a prior decision on who the “demos” is, on who is included in and excluded from the group that is supposed to govern itself democratically.

There is no problem when the democratic decisions of the group are strictly self-regarding; the “boundary problem” arises when the groups takes democratic decisions that affect outsiders, those who have been excluded from the demos by the initial boundary decision. And that happens quite often. Groups then take decisions that have consequences for other people who have had no say in the matter. Sometimes this happens inadvertently, but other times the boundary decision has been made precisely in such a manner that the outsiders have been excluded on purpose. An example of the former case is the decision by a democratic country to exploit its rainforest for wood exports, impacting the global climate. An example of the latter is the disenfranchisement of felons and the subsequent democratic decision to impose forced labor on prisoners.

This last example already indicates that the boundary problem isn’t limited to national frontiers. These national frontiers obviously raise important problems (and not only when they are contested, as in the case of the occupied territories in Palestine where the excluded Palestinians have to live with the decision of democratic Israel), but other, less material boundaries do so as well. In many cases, the prior boundary decision effectively determines (and in some cases is meant to determine) the consequent democratic decisions. When blacks were disenfranchised under the apartheid regime in South Africa, then this determined – and was intended to determine – the nature of the democratic decisions taken by non-blacks.

As is clear from these examples, the boundary problems arises when the decision-makers don’t include all those who are affected by the decisions. The boundary problem therefore violates a basic democratic principle, namely self-government and self-control. The purpose of democracy is precisely the avoidance of heteronomy, the political subjection of a community to the rule of another power or to an external law. The boundary problem can mean the reintroduction of – intended or unintended – heteronomy. Boundaries are obviously necessary for the creation of democracy – no democracy without a fixed demos, and no demos with boundaries, exclusion and inclusion – but they can also undo it, namely when they exclude people who are affected by the decisions of those who are included.

Three spheres, by M.C. Escher, symbolizing inclusion and exclusion

Three spheres, by M.C. Escher, symbolizing inclusion and exclusion

The rule that we should try to include in the demos all those who are affected by democratic decisions sounds good in theory but raises problems of its own. For example, it’s never clear beforehand who will be affected by a decision, and hence it’s impossible to include all those who may be affected. In addition, the affected population is extremely different from one decision to another, meaning that the rule would force us to radically reconsider and alter the demos for each decision. That seems practically impossible. And finally, the affected population may be very far away, physically, or may cover the entire world population, including those not yet born. Again, difficult if not impossible to solve this in practice.

Bob Goodin, who has thought about this a lot more than me,  states that we may perhaps not be able to always include all those affected by all decisions, but there is less and more. He states that over-inclusiveness is less of a problem than under-inclusiveness, and proposes some practical ways in which to promote inclusiveness.

Another way to solve the boundary problem is international democracy. International democracy – i.e. the creation of democratically governed cooperative inter-state institutions – can solve the problem of negative externalities imposed by the democratic decisions of one state on other states.

We can also do something about the boundary problem by granting immigrants some degree of voting rights. Immigrants, asylum seekers and refugees typically have no voting rights, even in the most democratic of countries. This is exacerbated by the often very restrictive citizenship application rules. And, finally, issues of global justice are also instances of the boundary problem. Decisions by rich countries regarding import quotas, free trade arrangements etc. obviously impact the poor in other parts of the world.

There is also another problem, similar to the boundary problem. People may not be de iure excluded from the demos, but de facto. I’m thinking here of so-called permanent minorities. Permanent minorities are groups of people who, although not officially disenfranchised, are always subject to the decisions of majorities.  Federalism would allow those permanent minorities that are regionally concentrated, to have self-government. When they are allowed, in a federal system, to make their own self-regarding decisions, they will no longer be affected by national decisions over which they have almost no influence, not because of a lack of voting rights, but because of a lack of voting weight. Federalism can solve the problem of a minority negatively affected by the decisions of a majority, not because it is disenfranchised but because it is a permanent minority.

More posts in this series.

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freedom, health, law, privacy, religion

Religion and Human Rights (18): Euthanasia

John Trever euthanasia cartoon

(source, cartoon by John Trever)

People own their own body. Their body is part of their private property. It is something that is theirs; it is the thing par excellence that is their own. It is not common to several people and it cannot be given away. It cannot even be shared or communicated. It is the most private thing there is. Owning your body means that you are the master of it. Other people have no say in the use of your body; they should not use it, hurt it or force you to use it in a certain way. This underpins the security rights such as the right to life, the right to bodily integrity, and the prohibition of torture and slavery. It also implies the right to self-determination and therefore the right to die.

More on euthanasia here and here.

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democracy, what is democracy?

What is Democracy? (9): Self-Government

democracy

Democracy is the right of the people and of every member of the people to participate in the decisions of the government and in the framing of the laws. The underlying justification of this right is the wish of the people to control their own lives.

Control over your own life is a universal value. Few people are willing to accept that their lives are controlled by others. Democratic participation and democratic political life guarantee this value and this is one of the reasons or justifications for the universal application of democracy.

Underneath the principle of self-control or self-government lies the claim that people can only be subject to those laws and decisions to which they agree, either because they voted for these laws themselves or because they have chosen the people who vote for these laws. This is a fundamental claim of democracy. If you have to obey laws you do not agree with, you do not control your own life.

There are two ways of guaranteeing that the people agree with the laws they are supposed to respect. One way is to allow the people to make the rules themselves, for example, by voting in a local meeting or in a referendum. That would be direct democracy. The other way is to allow the people to elect or dismiss representatives who frame the laws. In the latter case, the people contribute indirectly to the framing of the laws. Participation or control can be exercised on two levels: either directly or through the election or dismissal of representatives; election in the case of representatives who vote for the laws the people would also have voted for themselves, dismissal in the opposite case.

More on self-government.

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