In last week’s FIXES column, Tina Rosenburg summarizes the claims made in the new book Scarcity: Why Having Too Little Means So Much by authors Sendhil Mullainathan and Eldar Shafir.

Now Sendhil Mullainathan, a Harvard economist, and Eldar Shafir, a psychologist at Princeton, propose a way to explain why the poor are less future-oriented than those with more money. According to these authors, one explanation for bad decisions is scarcity — not of money, but of what the authors call bandwidth: the portion of our mental capacity that we can employ to make decisions.

Worrying about money when it is tight captures our brains. It reduces our cognitive capacity — especially our abstract intelligence, which we use for problem-solving. It also reduces our executive control, which governs planning, impulses and willpower. The bad decisions of the poor, say the authors, are not a product of bad character or low native intelligence. They are a product of poverty itself. Your natural capability doesn’t decrease when you experience scarcity. But less of that capacity is available for use. If you put a middle-class person into a situation of scarcity, she will behave like a poor person.

Read the full piece here.