You just don’t get me

Timothy Taylor has an excellent write up on the behavioural economics results coming out of the recently-released 2015 World Development Report. One of the most striking findings is that World Bank staff tend to overestimate the tendency for poor people to be fatalistic. From Taylor’s post:

What do development experts think that the poor believe, and how does it compare to what the poor actually believe? For example, development experts were asked if they thought individuals in low-income countries would agree with the statement: “What happens to me in the future mostly depends on me.”  The development experts thought that maybe 20% of tthe poorest third would agree with this statment, but about 80% actually did. In fact, the share of those agreeing with the statement in the bottom third of the income distribution was much the same as for the upper two-thirds–and higher than the answer the devleopment experts gave for themselves!

A number of other bloggers have picked up on this result, albeit without too much discussion about what this implies. I think the implicit assumption here are that development professionals are out of touch with the poor. I think there’s a number of ways we can interpret these results. Here’s the graph in question:

control_wdr

So the first possibility is the implicit one, that Bank staff don’t know what the poor believe, and possibly even that they assume the poor are fatalistic, possibly to a fault. Development economics is only starting to turn its head towards the convergence of fatalism, aspirations and economic outcomes (see, for example, the recent paper by Kate Orkin and her co-authors on aspirations in Ethiopia). The story that development experts buy into this belief is an easy one to believe, but not necessarily the right one. Note that it doesn’t at all take into account what the truth is, only perceptions.

Imagine your life’s outcomes are determined by (A) your own actions and (B) everything else, including randomness. How much weight would you put on (A) vs (B)? There’s no easy answer to this, but it is perfectly possible that the world’s poor ARE poor because (B) is actually much larger than (A). When you live in a country with terrible institutions, no social safety net, frequent economic or environmental shocks, it becomes very clear that (B) dominates (A).

So the second possibility is that Bank staff aren’t assuming the poor are being fatalistic, but that they are being realistic. That they (correctly?) judge that they have little control over their own lives. If they did, then they probably wouldn’t be poor. In this case, if the responses from the above sample are genuine (we might worry that respondents would be unwilling to admit that they have little control), then it’s the poor who have it the wrong way around: they are too optimistic about how much control they have over their own lives.

The second possibility isn’t necessarily any more likely than the first, but we should be cautious about what stories eventually emerge out of the above figure – there are a number of potentially overlapping biases at play, to the extent that it is not just a straightforward story of development professionals not `getting’ the poor.

4 thoughts on “You just don’t get me

  1. TO

    December 16, 2014 at 5:57pm

    Obviously, I don’t think anyone is suggesting that the development experts are wrong about how much control the poor have over their livelihoods, but that they are out of touch with how people see themselves.

  2. Matt

    December 16, 2014 at 6:02pm

    Right – agreed. I suppose what I am saying is that the true ratio of (A) to (B) for the poor has implications for what we take away from your last statement.

  3. MJ

    December 18, 2014 at 8:12am

    You raise a good point. Even if the question was intended otherwise (as per your above comments), who is to say many WB staff took the time to fully understand it? I, Afrophile and others, commented on Blattman’s post that we are not convinced that the poor people were being honest, but instead saying what they thought the surveyors wanted to hear (or that might lead to more aid). But how much attention do busy aidworkers pay to every survey that demands 10 minutes of their time? Conclusion: all questionnaires, like history, are bunk! (Only slightly over-reaching there …)

  4. Marcel

    January 7, 2015 at 2:33am

    There is also the possibility of methodical flaws in the survey.
    Another explanation might be that experience shows that in surveys People often try to present themselves in a better/different light. Answers are therefore kind of wishful thinking and not really reflecting the reality but showing how/what people think should be the reality.
    So not sure we should all blame it on the WB bureaucrats, it is an complex word out there..

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