Poverty and Aspirations Failure
AbstractWe develop a theoretical framework to study the psychology of poverty and 'aspirations failure'. In our framework, the rich and the poor share the same preferences - and also a behavioral bias in setting aspirations. Greater downside risks imposed by poverty exacerbates the effects of this behavioral bias: the poor are more susceptible to both an aspirations failure and pessimism about the likelihood of achieving success. Poverty limits the set of people whose life experiences the poor consider relevant for forming their own beliefs and aspirations. Mitigating behavioral poverty traps require policies which go beyond reducing material deprivation.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2011-124.
Date of creation: 2011
Date of revision:
Contact details of provider:
Web page: http://center.uvt.nl
Reference-dependent Preferences; Aspirations; Persistent Poverty; Locus of control; Simillarity and Belief Formation;
Other versions of this item:
- O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
- D03 - Microeconomics - - General - - - Behavioral Economics; Underlying Principles
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-12-19 (All new papers)
- NEP-CBE-2011-12-19 (Cognitive & Behavioural Economics)
- NEP-LTV-2011-12-19 (Unemployment, Inequality & Poverty)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Abhijit Banerjee & Sendhil Mullainathan, 2010.
"The Shape of Temptation: Implications for the Economic Lives of the Poor,"
- Banerjee, Abhijit & Mullainathan, Sendhil, 2010. "The Shape of Temptation: Implications for the Economic Lives of the Poor," CEPR Discussion Papers 7828, C.E.P.R. Discussion Papers.
- Abhijit Banerjee & Sendhil Mullainathan, 2010. "The Shape of Temptation: Implications for the Economic Lives of the Poor," NBER Working Papers 15973, National Bureau of Economic Research, Inc.
- Alois Stutzer, .
"The Role of Income Aspirations in Individual Happiness,"
IEW - Working Papers
124, Institute for Empirical Research in Economics - University of Zurich.
- Stutzer, Alois, 2004. "The role of income aspirations in individual happiness," Journal of Economic Behavior & Organization, Elsevier, vol. 54(1), pages 89-109, May.
- Loewenstein, George & O'Donoghue, Ted & Rabin, Matthew, 2000.
"Projection Bias in Predicting Future Utility,"
Department of Economics, Working Paper Series
qt5qh6142m, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- George Loewenstein & Ted O'Donoghue & Matthew Rabin, 2001. "Projection Bias in Predicting Future Utility," General Economics and Teaching 0012003, EconWPA.
- George Loewenstein, Ted O'Donoghue and Matthew Rabin., 2000. "Projection Bias in Predicting Future Utility," Economics Working Papers E00-284, University of California at Berkeley.
- Loewenstein, George & O'Donoghue, Ted & Rabin, Matthew, 2002. "Projection Bias in Predicting Future Utility," Working Papers 02-11, Cornell University, Center for Analytic Economics.
- Karlin, Samuel & Rinott, Yosef, 1980. "Classes of orderings of measures and related correlation inequalities. I. Multivariate totally positive distributions," Journal of Multivariate Analysis, Elsevier, vol. 10(4), pages 467-498, December.
- Kim-Sau Chung, 2000. "Role Models and Arguments for Affirmative Action," American Economic Review, American Economic Association, vol. 90(3), pages 640-648, June.
- Shawn Cole & Thomas Sampson & Bilal Zia, 2011. "Prices or Knowledge? What Drives Demand for Financial Services in Emerging Markets?," Journal of Finance, American Finance Association, vol. 66(6), pages 1933-1967, December.
- Gilboa,Itzhak & Schmeidler,David, 2001.
"A Theory of Case-Based Decisions,"
Cambridge University Press, number 9780521802345, October.
- Koszegi, Botond & Rabin, Matthew, 2004.
"A Model of Reference-Dependent Preferences,"
Department of Economics, Working Paper Series
qt0w82b6nm, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Richard Akresh & Emilie Bagby & Damien de Walque & Harounan Kazianga, 2012.
"Child Ability and Household Human Capital Investment Decisions in Burkina Faso,"
Economic Development and Cultural Change,
University of Chicago Press, vol. 61(1), pages 157 - 186.
- Akresh, Richard & Bagby, Emilie & de Walque, Damien & Kazianga, Harounan, 2010. "Child Ability and Household Human Capital Investment Decisions in Burkina Faso," IZA Discussion Papers 5326, Institute for the Study of Labor (IZA).
- Akresh, Richard & Bagby, Emilie & de Walque, Damien & Kazianga, Harounan, 2010. "Child ability and household human capital investment decisions in Burkina Faso," Policy Research Working Paper Series 5370, The World Bank.
- Chong, Alberto & Duryea, Suzanne & La Ferrara, Eliana, 2008.
"Soap Operas and Fertility: Evidence from Brazil,"
CEPR Discussion Papers
6785, C.E.P.R. Discussion Papers.
- Galor, Oded & Zeira, Joseph, 1988.
"Income Distribution and Macroeconomics,"
51644, University Library of Munich, Germany, revised 01 Sep 1989.
- SHALEV, Jonathan, 1997.
"Loss aversion equilibrium,"
CORE Discussion Papers
1997023, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Biewen, Martin, 2003.
"Who Are the Chronic Poor? Evidence on the Extent and the Composition of Chronic Poverty in Germany,"
IZA Discussion Papers
779, Institute for the Study of Labor (IZA).
- Martin Biewen, 2003. "Who Are the Chronic Poor?: Evidence on the Extent and the Composition of Chronic Poverty in Germany," Discussion Papers of DIW Berlin 350, DIW Berlin, German Institute for Economic Research.
- Robert Jensen & Emily Oster, 2007. "The Power of TV: Cable Television and Women's Status in India," NBER Working Papers 13305, National Bureau of Economic Research, Inc.
- Dalton, Patricio & Ghosal, Sayantan, 2008.
"Behavioural Decisions and Welfare,"
The Warwick Economics Research Paper Series (TWERPS)
834, University of Warwick, Department of Economics.
- Robert Jensen, 2010. "The (Perceived) Returns to Education and the Demand for Schooling," The Quarterly Journal of Economics, MIT Press, vol. 125(2), pages 515-548, May.
Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:CitEc Project, subscribe to its RSS feed for this item.
- Solava Ibrahim, 2011. "Poverty, aspirations and wellbeing: afraid to aspire and unable to reach a better life – voices from Egypt," Brooks World Poverty Institute Working Paper Series 14111, BWPI, The University of Manchester.
- Ghosal, Sayantan & Dalton, Patricio, 2013. "Characterizing Behavioral Decisions with Choice Data," CAGE Online Working Paper Series 106, Competitive Advantage in the Global Economy (CAGE).
- Marcus Böhme, 2012. "Migration and Education Aspirations - Another Channel of Brain Gain?," Kiel Working Papers 1811, Kiel Institute for the World Economy.
- Dalton, P.S. & Ghosal, S., 2010. "Behavioral Decisions and Welfare (Replaces CentER DP 2010-22)," Discussion Paper 2010-143, Tilburg University, Center for Economic Research.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Richard Broekman).
If references are entirely missing, you can add them using this form.