The psychology of scarcity: Why having too little means so much
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Not Synced♪ [upbeat violin and piano] ♪
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Not Synced>[ ELDAR SHAFIR]
It's a pleasure to be here. -
Not SyncedI'm going to talk to you about
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Not Syncedhow scarcity imposes demand
on our cognitive capacity. -
Not SyncedIn other words, on how the psychology
that comes from not having enough -
Not Synceddemands attention
and cognitive capacity -
Not Syncedand leaves us with
less mind for other things. -
Not SyncedI want to include— I want to quickly
mention scarcity of money, certainly, -
Not Syncedpoverty, scarcity of time,
-
Not Syncedscarcity of calories
if you're dieting, water, etc. -
Not SyncedAnd the argument is going to be then,
-
Not Syncedwhen you don't have
enough of something, -
Not Syncedit captures your attention,
it captures your mental capacity, -
Not Syncedand leaves you with less.
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Not SyncedYou'll see that how all this
connects actually very nicely -
Not Syncedwith the talks we had before.
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Not SyncedWe all know that attention is limited.
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Not SyncedOne of the things that's interesting
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Not Syncedis that we fail to appreciate
the extent to which it's limited. -
Not SyncedMany of you may have seen recent
research on using cell phone in cars. -
Not SyncedWe all know it's not so good.
-
Not SyncedIt's a disaster, as it compares to
being legally drunk by U.S. standards. -
Not SyncedThis is a classroom in New Haven.
-
Not SyncedIt's a lovely study that was done,
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Not Syncedwhere they noticed that the fifth graders
in this class, randomly assigned, -
Not Syncedhappened to find themselves
either on the quiet side of the school -
Not Syncedor near the other side of the school
where trains were going by. -
Not SyncedAnd so, when you sit in a class
and this train goes by, -
Not Syncedthere should be a sound.
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Not SyncedIf you could hear it,
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Not Syncedthat has an enormous distraction
on kids' attentional capacity, -
Not Syncedand what they found is that
the kids near the train tracks -
Not Syncedwere one year in academic
performance behind their friends -
Not Syncedon the other side of
the school at fifth grade. -
Not SyncedThey then installed soundproofing,
-
Not Syncedand a couple of years later,
they were matched again. -
Not SyncedSo, this is just a passing train
with an enormous impact, -
Not Syncedand the point is that these
are trains in the external world. -
Not SyncedYou don't need them
to be in the external world. -
Not SyncedImagine yourself in an office,
very quiet, no distractions, -
Not Syncedexcept you're worried about paying rent
or a child who is sick or anything else. -
Not SyncedThose internal trains are going to
have an impact that could compare, -
Not Syncedin terms of the attentional distraction
and the cognitive capacity, -
Not Syncedto having distractions on the outside.
-
Not SyncedAn amazing study
that was done in the ’40s -
Not Syncedhad to do with when the allied forces
realized they were about to inherit -
Not Synceda lot of hungry people in Europe,
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Not Syncedand they had no idea
how to feed them. -
Not SyncedFeeding hungry people
is a non-trivial task. -
Not SyncedA famous researcher
into nutrition in Minnesota -
Not Syncedconducted a series of studies.
-
Not SyncedThese are conscientious objectors who,
since they're objecting to “the Good War,” -
Not Syncedwere very eager to volunteer
to these studies. -
Not SyncedThese are capable young men
who volunteered -
Not Syncedto starve, not to death,
but to immense discomfort. -
Not SyncedAnd when you look at
the descriptions of what happens, -
Not Syncedyou know, there is
the obvious physical stuff. -
Not SyncedThey're too tired to keep
their hands up to wash their hair. -
Not SyncedThey need pillows to sit down
because their butts are too naked. -
Not SyncedBut the amazing stuff
also is the psychological. -
Not SyncedThese are young talented men
-
Not Syncedwho spend their entire time
-
Not Syncedplanning to open restaurants,
reading recipes, -
Not Syncedcomparing prices of foods
in different stores in the newspapers. -
Not SyncedThat's all they're thinking about.
It's taking all their cognitive capacity. -
Not SyncedIt's about food.
-
Not SyncedAt some point, the researchers
decide to distract them -
Not Syncedby showing them some films,
and these guys describe the films, -
Not Syncedand they couldn't care less
about the love scenes. -
Not SyncedThey want to see the meals.
-
Not SyncedAnd what's important here is,
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Not Syncedthis is not something
they're choosing to do; -
Not Syncedin a sense, they'd rather
do something else. -
Not SyncedIt just imposes itself on their minds
and it's very hard to avoid. -
Not SyncedSo the notion is that cognitive capacity,
which is a very limited resource, -
Not Syncedis captured by when you
don't have enough of something, -
Not Syncedand you basically find yourself
automatically paying a lot of mind -
Not Syncedto that thing you don't have.
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Not SyncedNow, a footnote, if this works well,
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Not Syncedyou should have these
annoying blinks on the screen. -
Not SyncedIf it was darker in here,
it would be very annoying. -
Not SyncedThese blinks that you're seeing
last 350 milliseconds. -
Not SyncedThat's how long you get
darkness every time you blink. -
Not SyncedYou blink approximately
15 times a minute. -
Not SyncedDuring the 12 hours
that you're awake every day, -
Not Syncedyou get one hour of nothing
but dark input into your eyes, -
Not Syncedwhich you have never seen.
-
Not SyncedThat's to say that your brain
is doing amazing stuff -
Not Syncedto which you have no introspective access.
-
Not SyncedAnd that's sort of important
-
Not Syncedbecause we walk around
with this amazing machine -
Not Syncedand we think we know what it's doing.
-
Not SyncedYou know, we know roughly,
like we know what our liver is doing, -
Not Syncedunless you're a physician.
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Not SyncedAnd so, basically, a lot
of the behavioral research, -
Not Syncedand I'm saying this because it's very
important when you get behavioral research -
Not Syncednot to do that,
“Yeah, does it feel right to me or not?” -
Not SyncedThe argument is a lot of what
we discover in behavioral research -
Not Syncedis about a mechanism
that's magnificently sophisticated, -
Not Syncedthat's behind the eyes
and between the ears -
Not Syncedto which you have very little access.
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Not SyncedI want to talk about particularly about
poverty and a little bit about time, -
Not Syncedbut again, the notion is
that scarcity in food, friends, water -
Not Syncedwill capture your attention in this way
and be very profound. -
Not SyncedNice studies have been shown,
for example, that it's top of mind. -
Not SyncedSo, you get subjects into a laboratory
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Not Syncedwho have been asked
not to drink for 4 hours. -
Not SyncedThey're now very thirsty.
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Not SyncedHalf of them are randomly
assigned to get water, -
Not Syncedthe other half get pretzels.
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Not SyncedNot a good idea when you're thirsty.
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Not SyncedThen they sit in front of a computer
and have to identify words. -
Not SyncedThese are words that are flashing
-
Not Syncedroughly as long as you had the [blink]
(it's 400 milliseconds), -
Not Syncedand you have to decide:
yes, it's a word or not it's a word. -
Not SyncedAnd what you find is, when you
get words that are related to thirst, -
Not Syncedthose who have had pretzels
-
Not Syncedidentify these words much faster
than those who've had water. -
Not SyncedIf you compare the performance
to neutral words, they're identical. -
Not SyncedAgain, this is not at the level--
this is pre-decisional. -
Not SyncedIt's way too fast.
-
Not SyncedIt's literally showing that the words
that are related to thirst -
Not Syncedhave higher semantic activation.
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Not SyncedThey're literally top of mind.
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Not SyncedThey're there to be tickled the minute
anything happens that's relevant, -
Not Syncedas opposed to other words.
-
Not SyncedAnd what the notion is,
that when it's top of mind, -
Not Syncedloneliness, for example,
there's nice research showing -
Not Synced(it's kind of a sad research,
but it's very compelling), -
Not Syncedwhen you're very lonely and
loneliness is mentioned or brought up, -
Not Syncedyou function less well.
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Not SyncedIt's distracting.
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Not SyncedSo, the sort of tragic impact
that loneliness has -
Not Syncedis that people are socially
as capable as anybody else, -
Not Synced[but] when they think about loneliness,
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Not Syncedsuch as, for example,
when you're interacting with somebody, -
Not Syncedwhat really matters to you to do well,
that's when you do the least well -
Not Syncedbecause you have cognitive capacity taken
by the concerns related to loneliness. -
Not SyncedDieting and [Cinnabons?], very similar.
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Not SyncedHere was a study within California.
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Not SyncedThis was a study done
with dieters and non-dieters. -
Not SyncedWe have them play fun word searches.
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Not SyncedYou see these are words
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Not Syncedwhere the odd-number words are
food-related (cake, doughnuts, sweets) -
Not Syncedand the even-number words are neutral.
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Not SyncedThere's two conditions: they get either
this one or they get another condition -
Not Syncedwhere now the food-related
words have been replaced -
Not Syncedby other irrelevant, neutral words.
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Not SyncedWe're going to have the dieters look
and the non-dieters look -
Not Syncedto find all these words.
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Not SyncedAnd what I'm going to do now
is look at how long it takes them -
Not Syncedto find the neutral words,
the words that are common to both. -
Not SyncedSo basically, I'm asking: How long
does it take you to find the word “cloud” -
Not Syncedwhen it's preceded by a doughnut
or when it's preceded by a picture? -
Not SyncedAnd what you see is
that [in] the non-dieters -
Not Syncedit makes no significant difference.
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Not SyncedThe dieters take twice as long to find
“cloud,” having just seen a doughnut, -
Not Syncedthan having just seen a neutral word.
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Not Synced[light laughter from audience]
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Not SyncedIt literally interferes
with what you do next. -
Not SyncedSo, it's top of mind, and when it's
triggered, it sits there, and it lingers, -
Not Syncedand it takes cognitive capacity
for what else you want to do. -
Not SyncedFinancial poverty is
the ultimate of all scarcities. -
Not SyncedWe've talked about
a lot of other scarcities. -
Not SyncedIt's important to keep in mind,
this is one that's nondiscretionary. -
Not SyncedI'll talk briefly about the busy.
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Not SyncedYou know, when you're very busy,
you don't have time. -
Not SyncedWe all talk about how busy we are.
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Not SyncedDon't tell anybody, but between us,
if you stop doing what you're doing, -
Not Syncednothing would happen [chuckles]
except for a few physicians in the room. -
Not Synced[light laughter from audience]
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Not SyncedBut basically, it's discretionary.
We choose to be busy. -
Not SyncedWhen you're poor –
-
Not Syncedand we can get into
interesting discussions about -
Not Syncedwhat is the minimum that you need
and how that changes culturally, -
Not Syncedbut when you don't have enough,
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Not Syncedwhen you can't pay rent,
when you can't put food on the table, -
Not Syncedthat's not discretionary,
and you can't take a break. -
Not SyncedWhen you're a dieter
(there's really nice research on this) -
Not Syncedand you have a very important project
this week, you say, “You know what? -
Not SyncedThis week, I'll just do what I need to do.
I'll go back to dieting next week.” -
Not SyncedNotice you can't say,
“I'll be rich this week. -
Not SyncedI'll go back to being poor next.”
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Not SyncedNot available.
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Not SyncedSo, it's a much more chronic,
permanent, and imposing condition. -
Not SyncedAnd what we did in this case is,
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Not Syncedwe ran some studies
in a mall in New Jersey. -
Not SyncedWe go to people in the mall,
ask them to participate. -
Not SyncedThey sit in front of a computer,
we give them classic cognitive tests -
Not Syncedthat have been used in cognitive
science for the last 30 or 40 years. -
Not SyncedOne is a test of cognitive control,
divided attention of sorts. -
Not SyncedSo, you sit in front of a computer.
-
Not SyncedWhen you see heart,
you have to quickly press the same side. -
Not SyncedWhen you see flower,
you have to press the opposite side. -
Not SyncedYou're getting a headache right away.
It's confusing. It takes a lot of attention. -
Not SyncedThe other-- All of you have seen if you've
done an SAT or GRE, any kind of test, -
Not Syncedit's a classic test that's supposed
to capture fluid intelligence. -
Not SyncedIt's a major component of the IQ test.
-
Not SyncedBasically, what shape fits best
in the missing space? -
Not SyncedSo, they sit and do these tests.
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Not SyncedAnd while they're doing these tests,
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Not Syncedwe give them
financial scenarios to contemplate. -
Not SyncedYour car breaks down, you have to think:
Are you going to take care of it? -
Not SyncedIn one condition,
the non-menacing condition, -
Not Syncedthe car is going to cost $300 to fix.
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Not SyncedIn the other condition,
the challenging condition, -
Not Syncedit's going to cost $1,500.
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Not SyncedAs you're thinking about:
Are you going to take care of the car? -
Not SyncedYou do these, and then
when you finish them, you tell us: -
Not Syncedhow you’re going to solve
your financial problem, okay? -
Not SyncedFinally, we'll get people's annual
household income and divide them -
Not Syncedby basically splitting in half
into rich and poor, okay? -
Not SyncedSo, we know you're either rich or poor,
we'll give you these problems, -
Not Syncedeither a cheap car to take care of
or an expensive car to take care of, -
Not Syncedand you do these cognitive
control and intelligence tests, -
Not Syncedwhat do you get?
-
Not SyncedLet's look first at the rich.
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Not SyncedThe rich, when they contemplate
the easy or the difficult car, -
Not Syncedperform equally well
in the cognitive control. -
Not SyncedIt's like a driving test.
-
Not SyncedThe poor, when they
contemplate the easy car, -
Not Syncedthe one that they can easily afford,
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Not Syncedlook exactly like the rich.
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Not SyncedBut when they're thinking about
a car that's hard to manage, -
Not Syncedthat's hard to afford,
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Not Syncedthey're now driving
significantly less well. -
Not SyncedThe cognitive control has diminished.
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Not SyncedLet's move to IQ.
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Not SyncedThe rich are not impacted
by what kind of car they're fixing -
Not Syncedwhile they're taking
these cognitive tests. -
Not SyncedThe poor, when they're thinking about
the car that's easy to take care of -
Not Syncedlook indistinguishable from the rich.
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Not SyncedBut when the poor are worried
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Not Syncedabout a car that's presenting
a real financial challenge, -
Not Syncedthey're performing here--
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Not SyncedWe've done this now
four different ways, -
Not Syncedreplicated four times
with financial incentives, -
Not Syncedthey're losing the equivalent
of 13 IQ points. -
Not SyncedSo, these are the same people
who, minutes ago, -
Not Syncedwhen the car was manageable,
performed just like the rich. -
Not SyncedNow that the car presents a serious
imposition (takes a lot of mind), -
Not Syncedperform significantly less well
on these IQ tests, -
Not Syncedon these fluid intelligence tests.
-
Not SyncedWe did all the controls we could
in New Jersey, -
Not Syncedbut these are, at the end of the day,
different people. -
Not SyncedThey're richer and less rich.
-
Not SyncedThey have had different education
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Not Syncedand they have different heart rates
and everything else. -
Not SyncedThe dream was, could we do this
within subjects? The same person. -
Not SyncedIt's not so easy to get people,
-
Not Syncedyou know, hundreds of them
who are both rich and poor, -
Not Syncedbut the third world does
present cases like these, -
Not Syncedand this is the best one we found.
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Not SyncedThese are sugarcane harvests
outside Chennai in the fields in India, -
Not Syncedand the sugarcane is
a particularly good case -
Not Syncedbecause you harvest only once a year.
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Not SyncedThese are all people
whose bulk of their income -
Not Syncedis received only once a year.
-
Not SyncedThey're rich after the harvest;
-
Not Syncedand because they're living
relatively tight lives -
Not Syncedand have a hard time
smoothing their consumption, -
Not Syncedthey find themselves poor
before the harvest. -
Not SyncedSo, we run the same people
now four months apart, -
Not Syncedtwo months before harvest
and two months after harvest, -
Not SyncedA lot of nuances that make this
very nice because the mills, -
Not Syncedbecause they're over capacity,
they tell the farmer when to harvest. -
Not SyncedSo, the harvests are spread
over many months. -
Not SyncedWe get rid of all kinds
of months effects, etc. -
Not SyncedWhat you find, essentially,
like in New Jersey, -
Not Syncedthe same people score
significantly less well -
Not Syncedon cognitive control
and fluid intelligence tests -
Not Syncedbefore harvest when they're poor
-
Not Syncedas opposed to after harvest
when they're rich. -
Not SyncedAnd now, of course, we've kept health,
education, everything else intact. -
Not SyncedIt's literally a function of
whether you have enough or not -
Not Syncedand how much cognitive capacity
that takes from you -
Not Syncedas you're trying to do these stupid tests.
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Not SyncedTime-- I'll spend less time today
on time, but many of us, -
Not Syncedmany of you are time-poor in ways
that are not completely different -
Not Syncedfrom the way that our subjects in India
and New Jersey are money-poor. -
Not SyncedYou have to think trade-offs.
-
Not SyncedYou have to borrow from tomorrow
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Not Syncedto do things that you haven't had
time to do today at high interest, etc. -
Not SyncedWhat we did here is run—
These are Princeton students. -
Not SyncedNobody would blame them for being myopic.
-
Not SyncedThey're highly educated,
they're very sophisticated. -
Not SyncedWe have them play a game, a classic
many of you know, Family Feud. -
Not SyncedIt's a game where they're
trying to get the answers. -
Not SyncedThey're very eager to do well.
-
Not SyncedThe performance gets
translated into payoff. -
Not SyncedAnd we make them randomly
either time-rich or time-poor. -
Not SyncedSo, you either have 50 seconds
per round or 15 seconds per round, -
Not Syncedwhich is not quite enough.
-
Not SyncedAnd in some conditions,
you cannot borrow. -
Not SyncedSo, when you're out of time,
you have to move to the next round. -
Not SyncedIn other cases, we allow you to borrow.
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Not SyncedWe offer you payday loans,
basically predatory lending rates. -
Not SyncedYou can borrow at high rates.
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Not SyncedSo, every second you take now,
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Not Syncedyou have 2 seconds less
left at the end of the game. -
Not SyncedWe look at how they do.
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Not SyncedWhat happens? There's two measures.
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Not SyncedThere's rounds completed
and points earned. -
Not SyncedI'm not going into the details.
-
Not SyncedThis is what you see
when there's no ability to borrow. -
Not SyncedSo, when you cannot borrow,
-
Not Syncednotice the rich obviously play
more rounds and get more points -
Not Syncedbecause they're rich,
they're playing more games. -
Not SyncedNow I'm going to let you borrow.
-
Not SyncedNow, if you run out of time,
-
Not Syncedif you want to,
you can take more seconds. -
Not SyncedThe rich notice—
-
Not Synced(This should come on at a time.
Maybe I don't have it.) -
Not Synced[For] the rich, notice,
there's no impact at all. -
Not SyncedThere is high-interest
borrowing available. -
Not SyncedDo I want to borrow?
I look and I say, -
Not Synced“No, it's not really useful.
It's not really worth it. -
Not SyncedI'm not doing it.”
-
Not SyncedThe poor (same Princeton students
just with less money), -
Not Syncedare dying to get this right,
are running out of time, -
Not Syncedare focused on what
they're doing right now. -
Not SyncedThe periphery gets less mind,
and they borrow. -
Not SyncedAnd they run out of time too quickly,
-
Not Syncedand they score and they
leave the experiment -
Not Syncedwith substantially less money.
-
Not SyncedSo, we're basically seeing
the sophisticated Princeton students -
Not Syncedtaking payday loans of the kind
that we typically claim -
Not Syncedthe poor are doing out of
lack of insight and intelligence. -
Not SyncedIt looks very much
not a function of who the person is, -
Not Syncedbut the context you put them in
that makes them act poor -
Not Syncedin ways that minutes earlier
-
Not Syncedin the mall, in the fields of Chennai,
in the Princeton lab, -
Not Syncedyou avoided if you were
just a bit richer. -
Not SyncedImplications, we all need to take
bandwidth a lot more seriously. -
Not SyncedWe have a very limited mind
when it's devoted to some areas -- -
Not Syncedand in poverty, it's a massive one
that never leaves us alone -- -
Not Syncedthere is just less mind
to pay attention to other things. -
Not SyncedAnd policymakers
typically don't think this way. -
Not SyncedSo, you saw Phil's FAFSA application.
-
Not SyncedThink about a poor person
who comes for some benefits program. -
Not SyncedImagine I propose—
Let's charge them $300 to join. -
Not SyncedYou'd say to me,
“Wait, they have no money. -
Not SyncedThey're coming for help.
-
Not SyncedWhy would you charge them money?”
-
Not SyncedWell, they also don't have bandwidth.
-
Not SyncedAnd when we charge them massive bandwidth
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Not Syncedto attend all kinds of events
at the right hour -
Not Syncedand fill out complicated forms
-
Not Syncedand do all the things that exactly
are what they don't have enough of, -
Not Syncednamely bandwidth
and attentional resources, -
Not Syncedwe're kind of doing the wrong policies.
-
Not SyncedSo, Phil's FAFSA, beautiful study
that you saw, is one example -
Not Syncedwhere you basically could
alleviate some bandwidth limitations. -
Not SyncedA lot of work has been done on defaulting
workers into retirement savings -
Not Syncedas supposed to expecting them
to do it on their own. -
Not SyncedThat has a big effect among
people who are too busy. -
Not SyncedAnd in healthcare,
there's a massive effect. -
Not SyncedSo, this is a glow cap.
-
Not SyncedA glow cap is a $12 plastic bottle
that delivers you medication, -
Not Syncedand it's structured so that
if it's not open at the right time, -
Not Syncedit blips and blinks and
sends you an email saying, -
Not Synced“I haven't been opened in time.“
-
Not SyncedAnd it turns out there are some
estimates in the third world -
Not Syncedwhere HIV is one case where
you can't just take 60% of the time. -
Not SyncedYou have to take all of it all the time.
-
Not SyncedSome estimates that $12 block cap
-
Not Syncedis having a two-decade
life expectancy impact. -
Not SyncedAnd clearly, it's a case where people
want to take it, they intend to take it, -
Not Syncedbut bandwidth is limited, and they forget
-
Not SyncedAnd so, if you take that more seriously,
there's an enormous amount you can do. -
Not SyncedLast thought, I'll leave you just
a picture that might stay in your mind. -
Not SyncedIn aviation, it's become
very clear very early on -
Not Syncedthat you can't train pilots any better.
-
Not SyncedThat's all they can do.
-
Not SyncedAs avionics get more complicated,
-
Not Syncedit's up to you to design
more sophisticated cockpits. -
Not SyncedAnd the argument here is, if you look
at people managing their poverty, -
Not Syncedthere is scarcity in different resources,
-
Not Syncedit's up to us, policymakers and others,
to design basically a cockpit a life -
Not Syncedthat's more manageable
given severely limited resources. -
Not SyncedOkay, I'll stop here.
-
Not Synced[audience applauds]
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