What underlies the Great Gatsby Curve? Psychological micro-foundations of the “vicious circle” of poverty

Arthur Sakamoto (), Jason Rarick (), Hyeyoung Woo () and Sharron Wang ()

Mind & Society: Cognitive Studies in Economics and Social Sciences, 2014, vol. 13, issue 2, 195-211

Abstract: Societies with a higher level of income inequality tend to have lower levels of intergenerational income mobility. Known as the Great Gatsby Curve, this negative relationship in part derives from greater intergenerational economic heritance among the poor. Societies with higher rates of relative poverty will have a higher level of income inequality, but they will also tend to have lower intergenerational mobility due to the reduced capacity of low-income persons to become upwardly mobile. Reviewing relevant research in psychology, we describe how poverty is associated with decreased psychological resources that compromise the competitiveness of low-income persons for superior attainment in the educational system and for greater productivity in the labor market. Economic deprivation in itself thus leads to a “vicious circle” of disadvantage that diminishes intergenerational mobility even without the existence of any culture of poverty or monopolistic institutions in the economy. Copyright Springer-Verlag Berlin Heidelberg 2014

Keywords: Poverty; Intergenerational mobility; Inequality; Stress; Cumulative risk (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://hdl.handle.net/10.1007/s11299-014-0144-x (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:minsoc:v:13:y:2014:i:2:p:195-211

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/11299

DOI: 10.1007/s11299-014-0144-x

Access Statistics for this article

Mind & Society: Cognitive Studies in Economics and Social Sciences is currently edited by Riccardo Viale

More articles in Mind & Society: Cognitive Studies in Economics and Social Sciences from Springer, Fondazione Rosselli Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().