2013-08-30

The Poor Aren't Stupid

While the rest of the blogosphere seems to have picked up on a that baffling Slate article about how sending your children to private school is immoral (huh?), Tyler Cowen at Marginal Revolution instead published a book review by a couple of economists who believe that the poor are unintelligent because they find monetary decisions more "stressful" than the non-poor do.

This may prove to be the "let them eat cake" moment of Mullainathan's and Shafir's career, that embarrassing gaffe from which they will try to run for the rest of their lives. At least, one can only hope so.

The economists found that rich people and poor people "look equally smart" (Cowen's words) when asked what to do about an unforeseen $300 car expense; but, when they changed "the question" (read: the entire scenario) to $3000 instead of $300, poor people "did much worse" when they attempted to answer the question. Cowen concludes,
Control studies suggest it is not about the number being larger per se, but rather that the poor individuals see this as a more stressful decision, which lowers their measured fluid intelligence.
A comment from Marie at Marginal Revolution succinctly summarizes the gist of my earlier comment, as follows:
The study seems a little detached from reality. 
Three thousand dollars is not just a stressfully large amount for the poor; it’s not just an amount that requires cutting into essentials. It’s an amount they can’t (often) acquire at all. Period. So the question posed to a rich person is “what would you do if you had a $3000 bill and that was hard?” but the same question for a poor person is “what would you do if you had a $3000 bill and you couldn’t pay it?” It’s an entirely different question. The idea that someone might be considered less (even simply momentarily) intelligent because he answers a different question differently seems pretty strange.
Indeed, Marie. To assess one group's response about how to deal with an existential threat against another group's response about how to deal with a substantial-yet-manageable unforeseen expense is thoroughly lousy science. But to declare that one group is less intelligent than the other based on a bad analysis is unfathomably thick.

One can hardly think about it without cringing. Clearly Mullainathan and Shafir - and Tyler Cowen, for that matter - have never been poor. Worse than that, they don't even seem to understand what being poor is and what kind of decisions the poor face. This in and of itself would not be inexcusable, but to profess to study the poor while demonstrating such a complete lack of understanding is not good.

Cowen caps it off by musing that he "would like to have a better sense of how this fits in with other results about the relative rigidity of IQ." You mean that made-up number that Steve Sailer uses to justify his racial supremacy theories? Good question!

Argh!