So think back to your last extented family gathering.
Let’s say, you know on Mildred turn 65 or something like that.
You don’t, you don’t really want to be there and
this is, this is especially true if you are a scientist
like me, you don’t have very good social skills.
I can see my dinner tables from last night,
nodding vigorously in the back.
Um… which is, which is ironic because
I’m a social scientist and so sort of the oxymoron of a lifetime,
like…like…being a vegetarian assassin.
But anyway you’re at this gathering
and there’s usually a point in the evening when
uncle George has had about ten glasses of wine and he says
to you something along the lines of you know money doesn’t buy happiness.
As well, as well I’m German, so I
suppose this would be delivered in sort of a drunken but Stern German accent.
But so when he…when he does this to you the next time,
I want you to tell him that he’s wrong.
And for the rest of the talk,
I’m going to tell you how we know this.
And there’s two reasons to be interested in this question.
The first is that you want to extricate yourself
from this conversation with uncle George.
But the second is that there is still about a billion people in the world
who live in abject poverty.
And I think it’s really urgent that we solve this problem.
And I think that asking this question
can be a first step in that direction.
So the kind of poverty that I have in mind
is first and foremost economic poverty.
So not having enough money to buy food,
being unable to pay for health care and education,
raising children who face similar prospects, and so on.
And over the past few decades,
economists and other social scientists have tried to
understand how we can alleviate poverty.
And so let me take a quick detour and tell you
about a tool that we use to do this.
So randomized control trials, take the idea of clinical trials,
and apply it to social programs.
So we work together with partner organizations,
and we take a poverty alleviation intervention in which we’re interested.
And the partner organization delivers it to a randomly chosen group of people,
and then comparing those people
to others who didn’t get the program,
allows us to make rigorous statements
about which interventions work and which don’t.
And so this approach has been very successful
over the past few decades in identifying poverty alleviation interventions that are successful.
So some of my favorite examples
come from attempts to increase school attendance in developing countries.
This is very important because children there often don’t go to school
with very bad long-term consequences.
And so suppose you had a hundred dollars to spend to increase school attendance,
how should you spend them?
So it turns out that you can buy about an extra week worth of school
attendance, if you simply give your hundred dollars to poor families.
You can buy about an extra three weeks of school attendance
if you instead you make the money conditional on family sending their children to school.
But it turns out there is an even better intervention available which is information
that buys you about an extra three months of school attendance for every hundred dollars that you spend.
And it’s an interesting intervention because it works simply by providing information
to parents about the returns to education that their children can expect
when they do go to school which the parents often underestimate.
So I want you to notice three things about these numbers.
The first is that there’re large differences here.
It’s so, it’s useful to do these randomized experiments
to find out which the effective interventions are.
The second is that the interventions that work well aren’t necessarily the ones
that we would have expected.
So for instance the effectiveness of information
that was a surprise to many people.
And third and that’s the point of the departure for my own work.
This very effective information intervention that happens entirely in people’s heads.
There’s no change in macroeconomic policy or the institutional environment or corruption
or anything like that.
It’s purely a change in the way that parents think
about the returns to education that has these large effects.
So what that suggests to me is that these small nudges
at the level of individuals people’s phy…individual people’s psychology
can be very effective at alleviating poverty.
And that in turn says I think that
we might be able to develop even better poverty alleviation programs
if we first try to understand better
where the poverty itself has a psychology.
So could it be the case that poverty has particular psychological consequences?
So for instance, what does it lead to
unhappiness, stress, depression, and so on.
伤心 紧张 沮丧等等
And secondly, could it be the case
that those psychological consequences in turn
have effect for economic behavior and decision-making that make it difficult to escape poverty.
So if you put those pieces together you have something like a psychological poverty trap.
And so over the past few years, I’ve been trying to understand
whether something like this exists.
And I want to tell you what I’ve learned
but I want to start with two caveats.
The first is that asking these questions isn’t the same
as saying the poor somehow to blame for their poverty
or that they’re somehow intrinsically deficient.
In fact it’s doing the exact opposite, it’s asking whether
all of us might experience particular psychological consequences or behave in particular ways
if we happen to find ourselves in a situation of poverty.
The second point is that I don’t think these psychological channels if they even exist
are the only ones that are important.
There’s many other important ones,
no macroeconomic policy institutions.
We should work on those as well.
But I think we should also ask whether psychology has some role to play.
So what have we learned, let’s start with the first question
about the relationship between poverty and psychological outcomes.
And let’s first ask it just at the level of a correlation.
It’s the correlation between poverty and happiness for instance.
For a long time we didn’t think this was the case.
This is the somewhat condescending view of you know happy
poor people sitting under palm trees having a good time.
Um…with new and better data,
maybe newfound respect for the poor,
we now know that this isn’t true.
So the best science now shows that
there are in fact large differences in happiness between rich and poor.
This is true both within countries and across countries.
So within the country the poor are less happy than the rich,
but also poor countries on average have lower levels of happiness
than rich countries on average.
And this is also true for stress and depression, so poor people
are more likely to be stressed and depressed.
So this is at the level of a correlation,
but what we really not want to know is whether there’s a causal relationship here.
And to answer that question we need an experiment,
but obviously we can’t increase poverty ethically.
But we can do the opposite we can decrease it,
and ask whether that has positive psychological consequences.
Now it turns out there’s a wonderful program out there
that allows us to ask this question,
gives directly, is a charity that
has as its mission to collect donations from people like you and me.
And send them directly to poor families in developing countries.
These are called unconditional cash transfers
which means that the families get to spend the money however they wish.
The idea here is to treat the people as the grown-ups that they are,
and not patronize them by telling them what they should do with the money,
but instead letting them make their own decisions.
And so we were interested in this program for two reasons.
First, it’s a very interesting poverty alleviation intervention
in its own right and we wanted to understand how well it works.
But secondly, it’s the perfect setting in which we can ask the scientific question.
So does this very definitional alleviation of poverty
simply giving people money also make them happier?
Does it make them less stressed and less depressed?
So together with my friend and colleague Jeremy Shapiro,
and our partner organization give directly,
we ran a randomized control trial in Kenya on this program
that covered 120 villages about 1,500 households,
and give directly delivered to these households unconditional
cash transfers of about 700 dollars on average.
This is roughly two years of per capita income.
And a year later we came back and we asked
how these transfers had affected people’s psychological well-being.
And we found that the people who had got the transfers
were much happier than they would otherwise have been.
They had lower levels of stress lower levels of depression.
And when they got very large transfers we found that that even led to reductions
in cortisol, the stress hormone.
By the way, I should say we also didn’t find increases in
spending on tobacco and alcohol.
The alcohol result of course being of particular importance to Uncle George
who is very concerned about just eight dollars being spent on, on alcohol, you know.
Meanwhile he himself has moved on to the tequila phase of the evening
which always works out well for him.
But he’s happy that the poor are making better decisions than him.
So that means that when you alleviate poverty by giving people money,
you improve psychological outcomes.
This is why uncle George is wrong.
So money does buy happiness.
Now if uncle George at this stage is sort of still
sober and with you enough,
he…he will say something like
well, but what about lottery winners?
I suppose I’m forgetting that he’s German, said…would be said that,
Johannes thought about a lot of evenness.
So what he has in mind are these anecdotes of which there’s no shortage,
that when people win the lottery, they essentially ruin their own lives.
They make imprudent financial decisions and they end up being worse off
than they would have been if they hadn’t won in the first place.
Now it turns out that also doesn’t hold up in the data.
So the best science now shows that lottery winners on average are actually
a lot happier than the non-winners.
So that’s an attempt to answer the first question the relationship between
poverty and psychological well-being.
Now let’s turn to the second question.
Could it be that these psychological consequences of poverty
have implications for economic decision-making
that make it hard to escape poverty?
And there’s two ways that you might imagine this could happen.
The first is that the stress that’s brought on by poverty
might affect economic choices in subtle ways.
And there’s now evidence suggesting that
when you’re under stress
you’re much more impatient than you are when you’re not stressed.
And that’s not a good thing if you’re supposed to make long-term decisions
and investments in things like health care and education.
And so unless you, poverty causes stress, stress makes you impatient.
And then that impatience doesn’t help you to lift yourself out of poverty.
But there’s a second sense in which the psychological consequences of
poverty might exacerbate poverty.
And that is that they may simply incapacitate you.
So when chronic stress turns into full-fledged clinical depression,
it’s very hard for people to keep earning a living.
So you don’t think your efforts will amount to anything.
You know no amount of information about returns to education can convince you otherwise.
It’s hard for you to even get out of bed in the morning
and your livelihood crumbles.
So this is bad enough when you’re wealthy,
but it’s worse when you’re poor.
And you don’t have as much of a safety net to fall back on.
So as a result of this, there’s a silent epidemic of depression among the poor.
And that’s the problem not only for psychological well-being,
but also for economic outcomes.
So if we think that this feedback loop exists
between poverty and psychological well-being, that then leads to more poverty.
The next thing we want to do is break it.
So how can we do that?
Well, there’s two obvious points where you can think about intervening.
One is on the poverty end itself.
The other is on the psychological end.
I’ve already told you that intervening on poverty
has positive psychological effects.
What I haven’t told you yet is that it also has positive economic effects.
So in our study we find that the people who receive the transfers
have higher levels of consumption a year later.
They grow their asset holdings, they grow their businesses, they improve
their economic lives in a very general sense.
This is also true for other programs.
Many other studies have found similar results.
But we don’t know much about yet
is how effective it can be to intervene on the psychological end.
So there now simple versions of psychotherapy available
that can be deployed in low-income contexts
if you train laypeople to deliver them.
And they’ve already been shown to effective to be effective in, in alleviating depression,
but we don’t know yet
whether they also have positive economic benefits.
So that’s my big question for the future.
Can we think of psychotherapy as not only an intervention for psychological well-being
but also a tool that people can use to improve their economic situation?
So there’s now studies underway in a number of different countries that
will give us an answer to this question.
And I’m really excited to learn that answer as uncle George.
Thank you very much!