Community trust reduces myopic decisions of low-income individuals

Proceedings of the National Academy of Sciences of the United States of America

Volumn 114, Issue 21, 2017, Pages 5401-5406

  Jachimowicz, Jon M ^a   Chafik, Salah ^a   Munrat, Sabeth ^b   Prabhu, Jaideep C ^c   Weber, Elke U ^d  

^a The Sanford C Bernstein Co Center for Leadership and Ethics   (United States)

^b RESEARCH AND EVALUATION DIVISION   (Bangladesh)

^c UNIVERSITY OF CAMBRIDGE   (United Kingdom)

^d PRINCETON UNIVERSITY   (United States)

Author keywords

Community; Decision making; Poverty alleviation; Temporal discounting; Trust

Indexed keywords

COMMUNITY; DELAY DISCOUNTING; ECONOMIC DEVELOPMENT; HIGHEST INCOME GROUP; HOUSEHOLD; HUMAN; INCOME; LOWEST INCOME GROUP; MEDICAL DECISION MAKING; PRIORITY JOURNAL; REVIEW; SOCIAL STRUCTURE; TRUST; ADULT; BANGLADESH; FEMALE; MALE; MIDDLE AGED; POVERTY; PSYCHOLOGY; SOCIAL ENVIRONMENT; YOUNG ADULT;

ADULT; BANGLADESH; DELAY DISCOUNTING; FEMALE; HUMANS; MALE; MIDDLE AGED; POVERTY; SOCIAL ENVIRONMENT; YOUNG ADULT;

EID: 85019598274     PISSN: 00278424     EISSN: 10916490     Source Type: Journal    
DOI: 10.1073/pnas.1617395114     Document Type: Review

References (64)

1. Mani A, Mullainathan S, Shafir E, Zhao J (2013) Poverty impedes cognitive function. Science 341:976-980.
2. Shah AK, Mullainathan S, Shafir E (2012) Some consequences of having too little. Science 338:682-685.
3. Lawrance EC (1991) Poverty and the rate of time preference: Evidence from panel data. J Polit Econ 119:54-77.
4. Yesuf M, Bluffstone R (2008) Wealth and time preference in rural Ethiopia. EfD Discuss Pap 23:1-19.
5. Lopez RB, Hofmann W, Wagner DD, Kelley WM, Heatherton TF (2014) Neural predictors of giving in to temptation in daily life. Psychol Sci 25:1337-1344.
6. Casey BJ, et al. (2011) Behavioral and neural correlates of delay of gratification 40 years later. Proc Natl Acad Sci USA 108:14998-15003.
7. Haushofer J, Fehr E (2014) On the psychology of poverty. Science 344:862-867.
8. Sen AK (1985) Commodities and Capabilities (Oxford Univ Press, Oxford).
9. Sen AK, Nussbaum M (1993) The Quality of Life (Oxford Univ Press, Oxford).
10. Lewis O (1959) Five Families: Mexican Case Studies in the Culture of Poverty (Basic Books, New York).
11. Lewis O (1966) La Vida: A Puerto Rican Family in the Culture of Poverty - San Juan and New York (Wiley, New York).
12. Sen AK (1987) On Ethics and Economics (Blackwell, Oxford).
13. Dohmen T, Enke B, Falk A, Huffman D, Sunde U (2016) Patience and the wealth of nations. Working papers 2016-012 (Human Capital and Economic Opportunity Working Group, Chicago). Available at econpapers.repec.org/paper/hkawpaper/2016-012.htm.
14. Gabaix X, Laibson D (2017)Myopia and discounting. Working paper no. 23254 (National Bureau of Economic Research, New York). Available at www.nber.org/papers/w23254.
15. Lusardi A, Schneider D, Tufano P (2011) Financially fragile households: Evidence and implications. Brookings Pap Econ Act 1:83-134.
16. Uslaner EM (2008) Where you stand depends upon where your grandparents sat: The inheritability of generalized trust. Public Opin Q 72:725-740.
17. Shah AK, Shafir E, Mullainathan S (2015) Scarcity frames value. Psychol Sci 26:402-412.
18. Michaelson L, de la Vega A, Chatham CH, Munakata Y (2013) Delaying gratification depends on social trust. Front Psychol 4:355.
19. Earle TC, Cvetkovich G (1995) Social Trust: Toward a Cosmopolitan Society (Praeger, Westport, CT).
20. Fukuyama F (1995) Trust: The Social Virtues and Creation of Prosperity (Hamish Hamilton, London).
21. Putnam R (2000) Bowling Alone. The Collapse and Revival of American Community (Simon and Schuster, New York).
22. Knack S, Keefer P (1997) Does social capital have an economic payoff? A cross-country investigation. Q J Econ 112:1251-1288.
23. Algan Y, Cahuc P (2010) Inherited trust and growth. Am Econ Rev 100:2060-2092.
24. Falk A, et al. (2015) The nature and predictive power of preferences: Global evidence. Discussion paper no. 9504 (Institute for the Study of Labor, Bonn, Germany). Available at https://ideas.repec.org/p/iza/izadps/dp9504.html.
25. Evans EM (2001) Cognitive and contextual factors in the emergence of diverse belief systems: Creation versus evolution. Cognit Psychol 42:217-266.
26. Rothstein B, Uslaner EM (2005) All for all: Equality, corruption, and social trust. World Polit 58:41-72.
27. Brandt MJ, Wetherell G, Henry PJ (2015) Changes in income predict change in social trust: A longitudinal analysis. Polit Psychol 36:761-768.
28. World Values Survey Association (2014) WORLD VALUES SURVEY Wave 6 2010-2014 OFFICIAL AGGREGATE v.20150418 (Vienna).
29. Miller AS, Mitamura T (2003) Are surveys on trust trustworthy? Soc Psychol Q 66: 62-70.
30. Rothstein B, Stolle D (2008) The state and social capital: An institutional theory of generalized trust. J Comp Polit 40:441-459.
31. Bjrnskov C (2007) Determinants of generalized trust: A cross-country comparison. Public Choice 130:1-21.
32. Ruberton PM, Gladstone J, Lyubomirsky S (2016) How your bank balance buys happiness: The importance of 'cash on hand' to life satisfaction. Emotion 16:575-580.
33. Yamagishi T, Yamagishi M (1994) Trust and commitment in the United States and Japan. Motiv Emot 18:9-66.
34. Weber EU, Hsee CK (1998) Cross-cultural differences in risk perception but crosscultural similarities in attitudes towards risk. Manage Sci 44:1205-1212.
35. Hsee C, Weber E (1999) Cross-national differences in risk preference and lay predictions. J Behav Decis Making 12:165-179.
36. Harrington JR, Gelfand MJ (2014) Tightness-looseness across the 50 United States. Proc Natl Acad Sci USA 111:7990-7995.
37. Cohen S, Wills TA (1985) Stress, social support, and the buffering hypothesis. Psychol Bull 98:310-357.
38. Cobb S (1976) Presidential Address-1976. Social support as a moderator of life stress. Psychosom Med 38:300-314.
39. Baumeister RF, Leary MR (1995) The need to belong: Desire for interpersonal attachments as a fundamental human motivation. Psychol Bull 117:497-529.
40. Ramos D, Victor T, Seidl-de-Moura ML, Daly M (2013) Future discounting by slumdwelling youth versus university students in Rio de Janeiro. J Res Adolesc 23:95-102.
41. Howe PD, Mildenberger M, Marlon JR, Leiserowitz A (2015) Geographic variation in opinions on climate change at state and local scales in the USA. Nat Clim Chang 5: 596-603.
42. Ball-Rokeach SJ, Rokeach M, Grube JW (1984) The Great American Values Test: Influencing Behavior and Belief Through Television (Free Press, New York).
43. Toubia O, Johnson E, Evgeniou T, Delqui P (2013) Dynamic experiments for estimating preferences: An adaptive method of eliciting time and risk parameters. Manage Sci 59:613-640.
44. Johnson EJ, Atlas SA, Payne JW (2016) Time preferences and mortgage choice. J Mark Res, in press.
45. Li Y, et al. (2015) Sound credit scores and financial decisions despite cognitive aging. Proc Natl Acad Sci USA 112:65-69.
46. Weber EU, et al. (2007) Asymmetric discounting in intertemporal choice: A querytheory account. Psychol Sci 18:516-523.
47. Berns GS, Laibson D, Loewenstein G (2007) Intertemporal choice-toward an integrative framework. Trends Cogn Sci 11:482-488.
48. Carvalho LS, Meier S, Wang SW (2016) Poverty and economic decision-making: Evidence from changes in financial resources at payday. Am Econ Rev 106:260-284.
49. Kearney M, Harris B, Jconne E, Parker L (2013) A Dozen Facts about Americas Struggling Lower-Middle Class (The Brookings Institution, Washington, DC).
50. Preacher KJ, Curran PJ, Bauer DJ (2006) Computational tools for probing interactions in multiple linear regression, multilevel modeling, and latent curve analysis. J Educ Behav Stat 31:437-448.
51. Strack F, Martin LL, Schwarz N (1988) Priming and communication: Social determinants of information use in judgments of life satisfaction. Eur J Soc Psychol 18: 429-442.
52. Schwarz N, Bless H, Strack F, Klumpp G (1991) Ease of retrieval as information: Another look at the availability heuristic. J Pers Soc Psychol 61:195-202.
53. Green L, Fry AF, Myerson J (1994) Discounting of delayed rewards: A life-span comparison. Psychol Sci 5:33-36.
54. Banerjee A, Karlan D, Zinman J (2015) Six randomized evaluations of microcredit: Introduction and further steps. Am Econ J Appl Econ 7:1-21.
55. Fernandes D, Lynch JG, Netemeyer RG (2014) Financial literacy, financial education and downstream financial behaviors. Manage Sci 60(8):1-23.
56. Donald SG, Lang K (2007) Inference with difference-in-differences and other panel data. Rev Econ Stat 89:221-233.
57. Edin K, Shaefer HL (2015) $2.00 a Day (Houghton Mifflin, New York).
58. Brehm J, Rahn W (1997) Individual-level evidence for the causes and consequences of social capital. Am J Pol Sci 41:999-1023.
59. Laibson D (1997) Golden eggs and hyperbolic discounting. Q J Econ 112:443-478.
60. Federal Deposit Insurance Corporation (2015) FDIC National Survey of Unbanked and Underbanked Households (Federal Deposit Insurance Corporation, Washington, DC).
61. Consumer Federation of America (2016) Legal Status of Payday Loans by State (Consumer Federation of America, Washington, DC).
62. Greene WH (1993) Econometric Analysis (Macmillan, New York), 2nd Ed.
63. Li Y, Baldassi M, Johnson EJ, Weber EU (2013) Complementary cognitive capabilities, economic decision making, and aging. Psychol Aging 28:595-613.
64. Ahmed T, Munrat S, Naher K (2017) An Evaluation Study on BRAC-THP Strengthening Local Governance Project (BRAC, Dhaka, Bangladesh).