Thursday, June 9, 2011

Mind:  Willpower Depletion and the Poor

Researchers have found that exerting self-control on an initial task impaired self-control on subsequent tasks: Consumers became more susceptible to tempting products; chronic dieters overate; people were more likely to lie for monetary gain; and so on. As Baumeister told Teaching of Psychology in 2008, "After you exert self-control in any sphere at all, like resisting dessert, you have less self-control at the next task."

In addition, researchers have expanded the theory to cover tradeoff decisions, not just self-control decisions. That is, any decision that requires tradeoffs seems to deplete our ability to muster willpower for future decisions. Tradeoff decisions, like choosing between more money and more leisure time, require the same conflict resolution as self-control decisions (although our impulses appear to play a smaller role). In both cases, willpower can be understood as the capacity to resolve conflicts among choices as rationally as possible, and to make the best decision in light of one's personal goals. And, in both cases, willpower seems to be a depletable resource.

Nowhere is this revelation more important than in our efforts to understand poverty. Taking this model of willpower into the real world, psychologists and economists have been exploring one particular source of stress on the mind: finances. The level at which the poor have to exert financial self-control, they have suggested, is far lower than the level at which the well-off have to do so. Purchasing decisions that the wealthy can base entirely on preference, like buying dinner, require rigorous tradeoff calculations for the poor. As Princeton psychologist Eldar Shafir formulated the point in a recent talk, for the poor, "almost everything they do requires tradeoff thinking. It's distracting, it's depleting ... and it leads to error." The poor have to make financial tradeoff decisions, as Shafir put it, "on anything above a muffin."

Last December, Princeton economist Dean Spears published a series of experiments that each revealed how "poverty appears to have made 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. As Spears found, "Choosing first was depleting only for the poorer participants." Again, if 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. Many of the tradeoff decisions that the poor have to make every day are onerous and depressing: whether to pay rent or buy food; to buy medicine or winter clothes; to pay for school materials or loan money to a relative. These choices are weighty, and just thinking about them seems to exact a mental cost.

All of this suggests that we need to rethink our approaches to poverty reduction. Many of our current anti-poverty efforts focus on access to health, educational, agricultural, and financial services. Now, it seems, we need to start treating willpower as a scarce and important resource as well.

Some promising approaches have already been tried. Starting in 2002, economists Nava Ashraf, Dean Karlan, and Wesley Yin created and analyzed a unique type of savings account at a small rural bank on the island of Mindanao in the Philippines. The Green Bank of Caraga's SEED accounts (Save, Earn, Enjoy Deposits) let clients place restrictions on when they could access their money. SEED clients could set either a date before which or a minimum savings amount below which they couldn't access their own funds. Twenty-eight percent of existing bank clients who were offered the accounts enrolled in them, and, after one year, the economists found, customers saved over 300% more with SEED accounts than they would have without them. The accounts offered an opportunity to circumvent self-control failure, in the same way Ulysses bound himself to the mast to resist the Sirens' call.

For more, see New Republic: Let Them Eat Cake or Don't Bake at All by Jamie Holmes, June 6, 2011 at NPR.

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