The Benefits of Penury. Sort of.

by F.

Looks like the poor recognize a good monetary opportunity faster that the rich:

The microeconomic law of diminishing marginal utility states that while accumulating a good—pretzels, pencils, nickels, whatever—each successive unit of that good will be less satisfying to acquire than the one before it. Finding a shiny quarter on the street is a real thrill. But, if you are carrying around a bag of coins, acquiring another one does not seem nearly as exciting. In fact, would you even bother to pick it up?

That hesitation is what researchers at the University of Cambridge in England were banking on when they designed a study to see if the haves catch on more slowly than the have-nots when it comes to reward-based learning. Reporting in the current issue of Neuron, the scientists reveal that when a small sum of money is on the line, poorer people learn quickly how to maximize their profits, leaving their wealthier counterparts in the dust.

As someone who came from a relatively poor family, this rings true to me. We were a single-income family, and my Dad’s income was below the median:

Median Income

Scentific American has a summary of the researchers’ paper, which was in Neuron.

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