Although IQ tests are arguably not an accurate or holistic way to measure intelligence, they do serve as one useful tool in determining a person's cognitive capabilities. According to new research, financial struggles can lower a person's IQ by up to 13 points, lending support to the hypothesis that poverty directly impairs cognitive functioning, the Daily Mail reports.
When people take on too much debt, according to a new study published in the journal Science, they are far more likely to make poor decisions and experience cognitive impairment. To reach this conclusion, a team of U.S. and British researchers carried out a series of experiments, the first taking place in an American shopping mall that involved 400 randomly selected people. The test subjects were separated into "poor" and "rich" groups based on their incomes before given intelligent tests.
Before the experiment began, half of the subjects were asked to consider how they would pay for $1,500 in urgent damages to their cars, provoking them to worry about their finances. Researchers discovered that those in the "poor" income group performed lower on the IQ tests if they had first considered their financial situations, while those in the "rich" groups remained unaffected either way. However, the group of "poor" and "rich" individuals that were not asked to consider financial woes all responded similarly on the intelligence tests.
"Our results suggest that when you're poor, money is not the only thing in short supply. Cognitive capacity is also stretched thin," Harvard economist Sendhil Mullainathan, co-author of the study, told the Daily Mail. "That's not to say that poor people are less intelligent than others. What we show is that the same person experiencing poverty suffers a cognitive deficit as opposed to when they're not experiencing poverty. It's also wrong to suggest that someone's cognitive capacity has gotten smaller because they're poor. In fact, what happens is that your effective capacity gets smaller, because you have all these other things on your mind, you have less mind to give to everything else."
In the second set of tests, the researchers traveled to rural India to study sugar cane farmers, who are paid "the majority of their income once a year." They discovered that farmers performed significantly better (by about 10 IQ points) on the intelligence testing the month after they had been paid, as opposed to before when their money supply was running low.
"The month after the harvest, they're pretty rich, but the month before - when the money has run out - they're pretty poor," Mullainathan said. "What we did is look at the same people the month before and the month after the harvest, and what we see is that IQ goes up, cognitive control, or errors, goes way down, and response times go way down."
