#6. Wealth, marshmallow and injustice

Reading this text about how socio-economic status shapes personality and behavior will take you about 6–7 minutes

There are two ways you can think about socio-economic factors in the psychology and behaviour of a person.

One is to separate the internal from the external, i.e., your wallet, your status, your health, age, etc, from what’s going on inside your brain. That way, we can gain a very clear understanding of what a personality is, measure it with various tests, such as the most commonly known Big Five. And whenever we see differences in actual behavior and life trajectories of people with the same test results, we attribute them to external factors as a separate issue.

That approach makes sense, and it aligns with what we observe in other areas. For instance, in medicine, we discuss blood chemistry, obesity rates, and age as internal factors, but we do not include the patient’s financial situation as part of their medical history.

There is a case to be made, however, that maybe we should. The effect your wealth may have, and will have, on your health is ubiquitous. The food, the access to medicine, the quality of life, the amount and quality of rest - all of those factors play a role in your health. So, two twins with the same cholesterol level in their 50s will have drastically different prognoses, if one of them can afford a personal dietitian, cook, and trainer, and a healthy, non-strenuous lifestyle, and the other works 12-hour shifts in a fast-food restaurant, just to make ends meet.

The same can be said about psychology. In the (in)famous marshmallow experiments, one of the iterations showed that the factor that predicted the ability of participants to wait for the delayed reward was the socio-economic status of the families. Which makes sense - if a child eats marshmallows regularly and has a family that isn’t financially burdened, thus tends to deliver on its promises, it is reasonable for that child to wait for an extra sweet. On the other hand, if the child only sees sweets on occasion, parents aren’t always capable of coming through, and maybe even when there is a treat at home - the faster you eat it, the less chances there are that someone will beat you to it - it’s just basic game theory to develop a strategy of gulping whatever sweet you can come across as soon as possible.

This approach offers a very different perspective on wealth and its impact on the psyche. A person with a million isn’t just a person without a million, but with a million. It’s literally a different person. Not just in terms of consumption abilities, but in terms of risk tolerance, anxiety, aggression level, assertiveness, and self-esteem, just as direct consequences of a different wealth level. And a lot more as subsequent, secondary, and tertiary layers of consequences. In fact, it would be a challenge to find a characteristic of a person that isn’t affected by their socio-economic status. So if we stick with the original understanding of psychology as a way of understanding the reasons, goals, and mechanics of human behaviour, and predicting it, we can’t get away from including money in the picture.

The idea that the rich and the poor differ in more than just purchasing power is mainly used in all sorts of motivational materials, along the lines of “think like a rich person”, implying that the right way of thinking will get you riches. Which isn’t such a ridiculous idea, and, while the “think and grow rich” part hasn’t been confirmed, there certainly are numerous examples of the opposite—the typical poor mentality that provably holds people down on the economic ladder.

However, there is another part of that story that isn’t as widely discussed. The part that being financially well-off is a much bigger game changer than people think. Being financially stable, let alone rich, isn’t just about buying new cars and devices, nor is it about the amount of room in the house, although that’s more important, and certainly not about spending a vacation at a more high-end resort. It’s about the abyss of background stresses that calm down.

There is a lot of talk about how money doesn’t bring happiness. Not only is it factually incorrect—we have studies to prove it—but the difference in quality of life between someone who’s struggling financially and someone who is not doesn’t begin to be described by what the financially burdened person imagines. Most people who are yet to stabilize their finances look at all the things they will buy and all the services they’ll use if they ever have enough. Hence, they believe that the only thing distinguishing their life now from life in a better financial status is the expected content of the purchases. This leads them to believe that it’s not such a big deal.

Well, someone has the latest iPhone, and I have a used phone from five years ago—so what, life is about bigger things, right? Right, but those bigger things are also much more accessible with enough money. When you can buy time, by delegating stuff you don’t want to do, when you don’t have to worry about how spoiling food will affect your budget, how a child breaking a toy will be a financial problem, how any medical issue might lead to bankruptcy, when your baseline of confidence in your standing is higher - you can do those bigger things that really matter in life much easier. You can wait for the second marshmallow, be more driven, more adventurous, more generous, kinder, and just a better person, if you have the money for it.

So the takeaway is this: believing in romantic ideals, seeking your passion, and devoting yourself to things you love is great. But it’s a costly mistake to underestimate how much of your quality of life, including the quality of your relationships and your overall satisfaction with who you are, comes from old, clichéd, vulgar money.

Until next week,
Konstantin Kunakh

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