Overview
Despite being the wealthiest country on earth, the United States is home to increasingly broad swaths of poverty, with much of it concentrated in urban centers. According to real-time estimates, the COVID-19 pandemic seems to exacerbate this trend: in the last six months of 2020, there was a 2-percentage point increase in poverty as defined by the US Census Bureau (from 9.4 to 11.4 percent); the effect is pronounced, especially among African-Americans, children, and people with high school education or less (Han et al., 2021). Data also shows increases in the households that struggle to put enough food on the table because they cannot afford it: around 9 percent of all US adults (and 16 percent among African-Americans and Latinos) report that their household sometimes or often did not have enough to eat in the last seven days (Center on Budget and Policy Priorities, 2021).
Poverty is typically defined in terms of a deficit of material resources that is linked to an inability to meet basic needs (as in the poverty thresholds defined by the US Census Bureau). Poverty, however, has many more dimensions beyond material deprivation. Social exclusion, lack of education, unemployment, and low income – all work together to reduce opportunities, limit choices, mine hope and, as a result, threaten self-efficacy and lower expectations for taking effective collective action. The absence of financial resources is closely linked with deficits in other types of capital, including human and social capital. Building these other forms of capital, which encompass factors such as education, skills, networks, relationships, and well-being, is essential for individuals to be able to permanently escape poverty (Daminger et al., 2015, p. 10).
Most research on poverty and on the barriers to social mobility has focused on institutional and structural aspects such as macro‐level labor market and demographic conditions (Brady, 2009). In contrast, we focus on the social and behavioral dimensions associated with poverty. In particular, we collect a nationally representative measurement of beliefs, social expectations, local norms, preferences, and trust levels among rural and urban poor populations across different areas of the US. This report presents early results from this effort related to diagnosing social norms in poor populations, the relationship between social norms and trust, and perceptions of intergenerational economic mobility. We summarize these three sets of findings below.
The Role of Social Norms
Norms influence behavior, but to study the extent of such influence we need to adopt precise and measurable concepts. More specifically, we work with beliefs and preferences, all easily measurable and lending themselves to predicting behavior. Social norms are behavioral rules that apply to sets of situations (Bicchieri, 2006, 2016). A first condition for their existence is that people know that the rule applies in specific conditions. Another condition is that individuals expect most other people in their reference network to follow the rule too. This is what we call an empirical expectation. A third condition is that individuals expect most other people in their reference network to believe that one should follow the rule and would disapprove of non-compliance. These are called normative expectations. The fourth and final condition is that individuals prefer to follow the rule if they hold both types of expectations, that is, preferences are conditional on expectations. As opposed to descriptive norms, of which conventions are an example, in the case of social norms preferences are conditional on holding both empirical and normative expectations.
Diagnosis of norms can guide intervention design for behavioral change. Similar interventions have been successful in changing collective behaviors in a wide variety of domains (Bicchieri, 2016). Through survey experiments, we examine four behaviors that are relevant to anti-poverty policies. We consider two education related behaviors: the decision to attend high school (as opposed to dropping out) and the decision to pursue higher education. We also examine the decision to apply for welfare assistance. Finally, we study the use of violence in response to instances of disrespect. We show how such different behaviors are influenced by shared norms, and we study the nature of such norms.
Turning first to high school attendance, the results of our study suggest that the decision to drop out of high school is affected by social norms. Those who report that dropping out of school is common and approved of in their reference network are more likely to drop out. In fact, our measures show that the decision to drop out is conditional on others' behavior and approval. Likewise, the decision to pursue higher education is also influenced by social norms.
Returns to education are high in the United States. In 2016, full-time year round workers who completed high school earned $6,400 more per year ($31,800) than those who did not ($25,400). Compared to completing high school, those with associate's degrees earned $6,200 more per year ($38,000) and those who finished a bachelor’s degree earned $23,000 more per year ($54,800) (National Center for Education Statistics, 2019). Yet there is great heterogeneity in educational achievement. While drop out rates have fallen considerably in the United States, this masks districts, high schools, and peer groups that have fallen behind (Social Explorer, 2024). In these settings, our results suggest it may be useful to employ interventions aimed at changing social expectations in order to influence high school attendance. These include interventions that correct misperceptions about drop out rates as well as changing people’s reference groups, and even identifying potential trendsetters who can influence school attendance.
We also study whether the decision to apply for welfare assistance is conditional on social expectations. Our analysis suggests conditionality of preference for this behavior, which provides suggestive evidence that social norms govern the use of welfare assistance. Notably, others’ approval tends to matter more than behavioral prevalence here, which may be related to stigma surrounding the use of welfare assistance. To further study the role of stigma, we also measure how embarrassment about the use of welfare assistance responds to approval and behavioral prevalence. We find that the likelihood of embarrassment is a function of these factors, and again that approval tends to play a stronger role, mirroring the previous result.
While much is made in American political discourse of the potential for dependence on welfare assistance, the established norms against welfare use and the stigma associated with this behavior could lead to reduced usage of programs that people qualify for. Indeed, the usage of welfare assistance often falls short of the pool estimated to qualify for these programs (Shrivastrava, 2021; Cunnyngham, 2023). These results are consistent with studies focusing on the United States which document stigma associated with usage of social programs (Mofitt, 1983; Celhay et al., 2022).
Finally, we study behavior related to honor norms. In particular, we study violence in response to disrespect. Our analysis suggests conditionality of preference with respect to social expectations, which indicates that this behavior is influenced by social norms.
How Norms Influence Trust
Social norms also shape social trust, which in turn influences economic behaviors such as spending, saving, and investing (Fromell et al. 2021; Lindbeck 1997). Together, these factors significantly impact long-term financial stability and the likelihood of remaining in or escaping poverty. Our research examines the relationship between poverty, social norms, and trust using a novel survey dataset. We argue that trust is behavioral: it manifests in concrete actions and relies on expectations about specific behaviors in particular situations. People form empirical expectations (beliefs about what others typically do) and normative expectations (beliefs about what others think is acceptable) based on their social environment, which is governed by norms (Bicchieri 2006, 2016).
Our survey experiment finds strong evidence that people’s levels of trust are particularly sensitive to the degree of social disorder and violence they experience, and that the sensitivity of social trust to the social environment survives across poor and more advantaged communities. We show that for all types of trusting behaviors we study, mean levels of trust fall progressively and significantly as we move from an environment governed by positive norms to an extremely negative social environment. The consistent decline in trust from positive to negative environments indicates that as individuals expect more members of their community to engage in and approve of antisocial behaviors, their trust in their community declines. We find that trust is relevant to upward economic mobility. Though it is well known that trust in the federal government affects perceptions of mobility, interpersonal trust is also extremely important. High levels of interpersonal trust predict more robust and extensive networks. Such networks are extremely important to expand one’s economic activities, providing the possibility of finding better jobs, and relying on trusted others in order to spend more time in productive activities.