The effect of cognitive function on the poor's economic performance: Evidence from Cambodian smallholder farmers

Abstract

Despite manifold policy interventions, poverty still exists. Those most harshly affected are people living in rural areas of low-income countries. A seminal strand in the literature presents a promising avenue for analyzing the lives of the poor by suggesting that poverty impedes cognitive function. However, the real-world consequences of impeded cognitive function are yet to be discovered. We ask whether the level of cognitive function can help to explain the differences in economic performance of the poor. We conducted a field study in rural Cambodia using the well-established Raven's Progressive Matrix to elicit cognitive function. Employing stochastic frontier analysis, we find that the level of cognitive function of poor smallholder farmers helps in explaining differences in economic performance. Our findings suggest that impeded cognitive function results in a negative economic performance feedback loop, which can be a reason why some farmers appear to be stuck in poverty while others manage to escape it.

Effects of changes in short-term human cognition on reported healthcare utilisation

“…Cognitive capacity or function includes a range of discrete mental channels that mediate one's ability to process information. Based on the work of Dean et al [7], Bruns et al [8] identify i) attention, ii) inhibitory control, iii) memory and iv) higher-order cognitive functions as channels of cognitive capacity. Where higher-order cognitive function includes fluid and crystallised intelligence.…”

“…Where higher-order cognitive function includes fluid and crystallised intelligence. A growing body of research indicates that given sufficient levels of financial stress, cognitive capacity, as measured by fluid intelligence, changes in the short run [3,8,9]. However, the relationship between other forms of cognitive capacity and stress is less clear [10].…”