![]() The current study is an empirical follow-up to this narrative review. While the authors provide a narrative review and psychological rationale of the causal mechanism, the model has not yet been tested against data. The model has linked socioeconomic status and economic preferences via cognitive load, executive functions, and intuitive/deliberative styles of decision-making. Therefore, Adamkovič (2019) proposed a theoretical model explaining how poverty influences a person’s economic decision-making. Until recently, there had been no formal model dedicated to grasping poverty perpetuation from the perspective of an individual. If these variables are indeed related, it should be possible to derive a tenable model of a mechanism that could explain why people cycle themselves in their financial situation. These, as well as the other correlates of poverty (for a review, see Pepper and Nettle, 2017), are often identical to the determinants of decision-making and preferences (see, for example, Burks et al., 2009 Capraro, 2019). Previous research has shown that poverty is related to factors like stress ( Haushofer and Fehr, 2014), cognitive load ( Schilbach et al., 2016), worsened cognitive functions ( Mani et al., 2013), and present-oriented behavior ( Griskevicius et al., 2011). Yet, it would be an inappropriately simplified assumption to say that such decisions are directly caused by the conditions of poverty per se. In particular, their willingness to delay gratification is claimed to be lower (see, for example, Griskevicius et al., 2011 Brown et al., 2015) and they tend to be more reluctant to take risks when a reward is involved ( Haushofer and Fehr, 2014). People living in poverty are said to have suboptimal economic preferences that could play an important part in poverty perpetuation ( Kraay and McKenzie, 2014). However, it is unclear what drives these decisions and whether (and how) they are determined by a person’s actual economic situation. To a certain extent, a person’s financial situation is determined by the economic decisions that they make. Besides the well-known cultural, social, environmental, and health-related causes, the inability to escape from poverty might be determined by psychological factors which can be studied at the level of individuals. Poverty is one of the greatest challenges facing society, persisting in spite of efforts to alleviate it. The paper discusses several plausible sources of the negative findings and possible directions for future research are suggested. ![]() In summary, the hypothesized cognitive mechanism does not explain what economic decision-making depends on nor why people fall into poverty traps. The sensitivity analysis revealed that the majority of the observed estimates varied substantively depending on the arbitrary analytic decisions of the researcher. Simultaneously, the dyadic relationships between the variables were mainly found to be weak. The results showed that neither the proposed model as a whole found the required support in the data nor the consequent, theoretically justifiable, respecifications improved its fit so that it could be deemed acceptable. In order to test the model against the data, three studies (exploratory, confirmatory, and replication) were conducted with a total sample size of 1182 participants. The paper aims to assess the verisimilitude of the hypothesized model of poverty perpetuation which links socioeconomic situation and economic preferences via cognitive load, executive functions, and intuitive/deliberative decision-making styles. ![]() Institute of Psychology, Faculty of Arts, University of Prešov, Prešov, Slovakia.
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