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Myopic misery: Maternal depression, child investments, and the neurobiological poverty trap

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  • Strulik, Holger

Abstract

In this paper, I explore in an overlapping generations framework, a mechanism motivating a neurobiological poverty trap. Poverty causes stress and depression in individuals susceptible to depression. Poor and depressed individuals discount the future at a higher rate and invest less in the human capital of their children than mentally healthy or rich individuals. This gene-environment interaction generates a vicious cycle in which poor individuals inherit not only susceptibility to depression but also stress and poverty. I show that a successful one-time intervention has the power to permanently eliminate the neurobiological poverty trap.

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  • Strulik, Holger, 2016. "Myopic misery: Maternal depression, child investments, and the neurobiological poverty trap," University of Göttingen Working Papers in Economics 294, University of Goettingen, Department of Economics.
    • Handle: RePEc:zbw:cegedp:294
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    More about this item

    Keywords

    child investment; development; depression; discounting; intergenerational transmission; gene-environment interaction;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • D10 - Microeconomics - - Household Behavior - - - General
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General

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