Poor Concentration: How Poverty Changes the Way You Think

Business & Money

One of the points I make in this week’s magazine story on American poverty is that being poor isn’t simply about not having enough income. Living on a slim financial margin often goes hand-in-hand with other destabilizing dynamics, such as shifting work schedules, paycheck amounts, transportation availability, and child-care arrangements. Relying on family members for babysitting or a colleague for a ride to work introduces a level of coordination—and likely stress—that richer people generally don’t have to deal with.

It’s hardly surprising that the stresses of poverty would take a psychological toll, but new research is showing just how stark a toll it can be. In one recent experiment, Princeton psychologists Eldar Shafir and Jiaying Zhao and Harvard economist Sendhil Mullainathan presented shoppers in a New Jersey mall with one of two scenarios about their car needing repairs. In the first situation, the cost was $150 and in the other…

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