But sudden windfalls improve poor people's mental fortunes
Poverty drains brains while it empties pocketbooks, a new study concludes.
Money worries consume poor people’s attention, dramatically undermining their performance on IQ-related tests of reasoning and mental control, say economist Anandi Mani of the University of Warwick in Coventry, England, and her colleagues. Among the poor, but not the rich, evoking financial concerns damages reasoning abilities about as much as going a night without sleep or losing 13 IQ points, Mani’s team reports in the Aug. 30 Science.
Shortly after reaping a financial windfall, poor individuals perform far better on the same mental tests. That improvement may be thanks partly to temporary freedom from money concerns, the scientists propose.
Their findings follow evidence that scarcity of money (or anything else important) promotes short-term thinking, helping to explain why poor people generally save too little