WHY DON’T THE POOR ACT MORE LIKE ECONOMISTS?

WHY DON’T THE POOR ACT MORE LIKE ECONOMISTS? This article by Drake Bennett discusses the claim by Charles Karelis that “traditional economics just doesn’t apply to the poor.” Poor people don’t–and can’t–make rational choices among competing goods or courses of action because they have too many problems to think in those terms. Karelis uses the example of a person suffering from multiple bee stings; treating only one sting will not reduce the pain. The person has no incentive to treat only of the stings (or problems). “The core of the problem has not been self-discipline or a lack of opportunity,” Karelis says. “My argument is that the cause of poverty has been poverty.” Karelis recommends attacking poverty by giving the poor money with no strings attached. Note that Robert Fogel argued in THE ESCAPE FROM HUNGER AND PREMATURE DEATH that malnutrition has historically reduced the productivity of the poor. Karelis is writing about a way of thinking and not just ill health.