Poverty Interrupted White Paper

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Transcript of Poverty Interrupted White Paper

  • Authors: Allison Daminger Jonathan Hayes Anthony Barrows Josh Wright

    May 2015

    Poverty InterruptedApplying Behavioral Science to the Context of Chronic Scarcity

    http://www.ideas42.org

  • Poverty Interrupted: Applying Behavioral Science to the Context of Chronic Scarcity | 2i d e a s 4 2

    ideas42 would like to thank the W.K. Kellogg Foundation, Battle Creek Community Foundation, and Sterling Speirn for their generous support of this research. We also thank Eldar Shafir of Princeton University, Beth Babcock of Crittenton Womens Union, and Steve Cohen of the Center for the Study of Social Policy for reviewing an earlier draft of this white paper and providing invaluable feedback. In addition, we appreciate the assistance of the Corporation for Enterprise Development in developing the initial stages of this work and the guidance and support of several colleagues at ideas42 who provided content knowledge and editing assis-tance. Finally, the authors are extremely grateful to the academic researchers, service providers, and parents whose stories and work greatly informed our insights and recommendations.

    Acknowledgements

    https://www.wkkf.org/http://www.bccfoundation.org/

  • Poverty Interrupted: Applying Behavioral Science to the Context of Chronic Scarcity | 3i d e a s 4 2

    ideas42 is a non-profit behavioral design firm that uses behavioral science to help solve difficult social problems and have impact at scale. We grew out of research programs in psychology and economics at top academic institutions and our work draws on decades of experimental scientific research in decision-making, along with the most rigorous methods in program and policy evaluation. We work in a number of areas, including consumer finance, economic mobility and opportunity, health, education, energy efficiency, and international development. The consequences of the behavioral issues we tackle are often profound. A failure to adhere to medication can be life-threatening. Dropping out of school can prevent a person from achieving her potential. All too often, the reasons for these failures turn out to be small and remediablebut also usually overlooked or dismissed as unimportant. Our approach involves carefully diagnosing the behav-ioral issues that prevent otherwise well-designed programs and products from achieving their goals. We identify subtle but important contextual details that can influence behavior, and design innovative solutions that help to overcome or amplify their effects. Our work involves a lot of observation, plenty of patience, and a willingness to be surprised. Most of all, though, it involves asking the right questions.

    About ideas42

    For Contact: Allison Daminger (adaminger@ideas42.org) | Jonathan Hayes (jhayes@ideas42.org) Anthony Barrows (anthony@ideas42.org) | Josh Wright (josh@ideas42.org)

    Learn more at www.ideas42.org

    http://www.ideas42.orghttp://www.ideas42.org

  • i d e a s 4 2 Poverty Interrupted: Applying Behavioral Science to the Context of Chronic Scarcity | 4

    ContentsI. Introduction. ................................................................................................................................... 6

    An old fight .............................................................................................................................. 6

    A way forward .......................................................................................................................... 7

    II. Applying a Behavioral Lens to Traditional Approaches...............................................................10Recontextualizing poverty ....................................................................................................... 10

    An alternative view .................................................................................................................. 12

    III. Design Principles ....................................................................................................................... 15A. Cut the costs ......................................................................................................................... 17

    The high costs of poverty ........................................................................................................ 17

    Reducing the costs ................................................................................................................. 21

    i. Make communication clear and actionable ....................................................................... 21

    ii. Reduce barriers to entry .................................................................................................. 23

    iii. Increase accessibility ...................................................................................................... 24

    iv. Cut the strings ............................................................................................................... 25

    v. Create synergies ............................................................................................................. 27

    B. Create slack .......................................................................................................................... 29Two suitcases ......................................................................................................................... 29

    Providing a cushion ................................................................................................................ 31

    i. Be unconditionally generous ............................................................................................ 32

    ii. Value time as money ....................................................................................................... 33

    iii. Replace cliffs with slopes................................................................................................ 34

    iv. Establish safeguards ...................................................................................................... 35

    v. Build backstops .............................................................................................................. 37

    C. Reframe and empower ......................................................................................................... 39The toxic environment of poverty ............................................................................................. 39

    Preserve and respect autonomy .............................................................................................. 44

    i. Use intentional language .................................................................................................. 44

    ii. Leverage positive identities ............................................................................................. 45

    iii. Treat families as experts ................................................................................................. 46

    iv. Confront biases .............................................................................................................. 46

    v. Create plausible paths .................................................................................................. 47

    IV. Where Do We Go From Here? .................................................................................................... 49

  • 45.3 millionAmericans live below the poverty line.

    $500 billion:the estimated annual costs of domestic povertyequivalent to 5% of U.S. GDP.

    Approximately 19 millionfewer Americans would be living in poverty

    if our countrys poverty rate matched the norm among other developed countries.

    $1000:median net worth for

    families living below the poverty line in Detroit, MI.

    Over16 million(1 in 5) U.S. children under 18 live below the poverty line.

    $326 or less:

    the monthly TANF benefit to a family of 3

    in 16 states. 34 millionAmerican households are unbanked or underbanked. This figure is approximately equivalent to the population of the 22 largest cities in the United States combined.