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Community Development Alliance Scotland

How poverty affects people’s decision-making processes

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A Joseph Rowntree Foundation report summarises the most recent evidence on the relationship between socioeconomic status and the psychological, social and cultural processes that underpin decision-making.

The studies reviewed present evidence that people living in or near poverty experience a shift in psychological, social and cultural processes that may hinder their ability to make decisions that are beneficial in the long term. Many of the suboptimal decisions and behaviours associated with low-income groups focus on the present (rather than the future), the actual (rather than the hypothetical), those socially close (rather than those socially distant), and the ‘here’ (rather than places far away). Such shifts lead to choices that are not always bad ones, but rather are adaptive to the constrained circumstances of low socio-economic status.

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