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Why Do People Stay Poor? [pdf]

sticerd.lse.ac.uk

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Re: Why Do People Stay Poor? [pdf]

#111

Post by jeffbee »

rayiner wrote: post #100
jeffbee wrote: post #95

Earlier quoted context omitted.

What would be the point of such trust funds? Assuming they were not intended to pay out until higher education (age 18?) it would just look exactly like Social Security: a supposedly-funded massive future liability that the federal budget borrows against and/or repeatedly attempts to privatize. Except your idea would receive even higher contributions than Social Security does.

Are you asking what people would be able to use $250k for?

No, I'm asking why it would be structured like that. It seems like an open invitation to just raid and squander it.

If you took the same amount of money you could, just as an example, permanently endow a professional educator for every 20 births, which begins paying off right away, instead of decades later.

Re: Why Do People Stay Poor? [pdf]

#112

Post by dnautics »

feralimal wrote: post #32

For the individual, the answer is Debt. And servicing repayments of debt. Eg, that on the typical mortgage you repay ~3 times what you borrowed.

I think that most people in the lower 50% wage bracket do not have a mortgage. People in the lowest 20% don't even have a credit card, probably.

The answer is still likely: Debt. When we take out sovereign debt it increases cost of living, and usually the way that sovereigns typically use that debt is via payouts to contractors, which does not go to the bottom 50%, except perversely via trickle-down effects. If you look at the "socialist" countries that have low poverty rates, typically they also have low rates of sovereign borrowing (think Norway, Sweden, and Denmark).

Re: Why Do People Stay Poor? [pdf]

#113

Post by simulo »

bschne wrote: post #4

To anyone interested in the topic, I recommend reading Duflo & Banerjee's 2011 book "Poor Economics". They pioneered the approach of using RCTs to test interventions in fighting poverty (for which they received the Nobel Memorial Prize together with Michael Kremer). They go into a lot of factors as to why poor people get certain economic outcomes, including but not limited to the poverty trap theory, and take a refre…

I second that. The RCTs get discussed most often. But what was eye-opening for me were their observations on how poor people manage the few resources they have matching the infrastructure they can access – like investing in bricks (Ch8)

Re: Why Do People Stay Poor? [pdf]

#114

Post by 908B64B197 »

TrackerFF wrote: post #46

This is something I enjoy about our jobs up in Scandinavia - the salaries are very compressed around the mean. Engineers, Lawyers, and other similar professions tend to earn 2x-3x of what the absolute minimum wage jobs earn. That's quite the difference compared to other countries, where Engineers can earn 5x-20x. People here are still motivated to seek higher education and better paid jobs, even though they could liv…

I wonder what's the effect on emigration/immigration. It sounds like the gap between Scandinavia and other part of the world would make it tempting for high performers to leave.

Re: Why Do People Stay Poor? [pdf]

#117

Post by e40 »

jcun4128 wrote: post #10

Without making the jump from washing plates/factory work to software I don't know how I would have escaped(still haven't) considering my pay increased 4 times. Just brutal when you trade hours for money directly at a low rate, I was doing 70hrs washing plates before and it was nothing ha. Edit: there is the thought of living within your means, personally with a roommate I could live on $10-$20K a year which you can m…

Ever read the Zine from the 90's called Dishwasher? That is my favorite Zine of all time. I absolutely loved it.

Re: Why Do People Stay Poor? [pdf]

#118

Post by yelloweyes »

Kye wrote: post #84
nicbou wrote: post #39

Earlier quoted context omitted.

People vastly underestimate how hard it is to do anything without capital/savings. If you are one missed paycheque from going hungry, you can't afford any risks. No going back to school, no going freelance, no interviewing, no investing in anything. You can't afford the means to make money, whether it's a car, a computer or nice clothes. You can't afford them breaking down, but you also can't afford maintaining them.…

I try not to think too hard about how my recent progress toward not being completely hopeless depended on a few inflection points that could easily have gone another way or could have been inaccessible had a few earlier events gone a different way. Luck is a force multiplier that can go wrong as easily as it goes right. Circumstances determine how much you can prepare for either type.

Yeah same here. Just got a close to dream job, and if I had waited maybe another week to contact them maybe it wouldn't be available anymore.

Re: Why Do People Stay Poor? [pdf]

#120

Post by grugagag »

refurb wrote: post #102
hprotagonist wrote: post #77

The reason that the rich were so rich, Vimes thought, was because they managed to spend less money. Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots…

I'm not trying to generalize, because I know poor people who are poor through no fault of their own (and we should provide public support for them), but I also know a larger number of people who contributed to their own dire financial situation and it wasn't because they couldn't afford quality boots, it was because they over-extended themselves with new cars, a way too big house, the big screen TVs and expensive tri…

Let me guess, credit card debt. I would take into consideration also the trap that creditcard companies set for unsuspecting folk, who make the mistakes themselves, is true ,but who were set up into a trap way before spending any penny.
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