The effects of poverty and inequality are difficult to separate and are often confused. A research project interviewed poor people in Uganda, India, China, Pakistan, Korea, Norway and the United Kingdom and about their experience of poverty. In terms of people's objective material living standards, poverty means completely different things in those countries - ranging from living in a one-roomed shack, with an earth floor and no piped water or sewerage, to living in a three bedroomed house with hot and cold water, central heating and TV. But the subjective experience of poverty in those countries was strikingly similar despite the very different material conditions. The research report concludes:
"Respondents universally despised poverty and frequently despised themselves for being poor. Parents were often despised by their children, women despised their men-folk and some men were reported to take out their self-loathing on their partners and children. Despite respondents generally believing that they had done their best against all odds, they mostly considered that they had both failed themselves by being poor and that others saw them as failures. This internalisation of shame was further externally reinforced in the family, the workplace and in their dealings with officialdom. Even children could not escape this shaming for, with the possible exception of Pakistan, school was an engine of social grading, a place of humiliation for those without the possessions that guaranteed social acceptance."
No parent was able to escape the shame of failing to provide for their children even when children were prepared to stop asking for things - the latter itself being a further source of shame.
This leaves no doubt that a central feature of the experience of poverty is what it feels like to be at the bottom of the social ladder.
Two other pieces of evidence lead to exactly the same conclusion. The first comes from what social psychologists call "stereotype threat" experiments. One which was reported by the World Bank involved high and low caste Indian children doing pen and paper tests. When they did not know each other's caste, high and low caste children performed equally well. But as soon as caste had been made known, the lower caste children performed much less well than the higher caste children. Similar experiments have been done with young adults showing effects on performance of even subtle reminders that you come from a class, ethnic group or gender widely regarded as likely to be less good at a particular task. These experiments again show that there are powerful effects of low status independently of material circumstances. And finally, the lack of any relationship among the rich developed countries between average life expectancy in each country and economic growth or GNP per head, suggests that differences in living standards in the rich world no longer matter. But within each country, relative income, or where people are in the social hierarchy, is very closely related to health.
These three very different kinds of evidence all point in the same direction: that independently of absolute material living standards, social status has powerful effects on self-perception, how others see us, on performance, and on health.
We can, however, now make an important additional point. In societies with larger income differences between rich and poor, the effects of social position, status or class, become stronger. And the more status matters, the bigger its effects. This is why all the problems which tend to be more common lower down the social ladder (i.e. with a 'social gradient') get worse in societies with bigger income differences. But inequality does not just impact the poor. Although increased inequality affect the poorest most, the statistical evidence shows that the better off are also affected, even if to a lesser extent. The fact that inequality affects the vast majority of the population explains why the differences in the performance of more and less equal countries are so large. Rates of homicide, mental illness, infant mortality, teenage birth rates, imprisonment rates and how much people feel they can trust others, are all between twice and ten times as bad in the more unequal of the rich countries (such as the USA or Britain) and the more equal (such as the Scandinavian countries).
The effects of inequality give the lie to the widespread view that the social gradient in different problems results from social mobility moving the resilient and capable up the social ladder and the vulnerable down. Merely sorting the population like that would not change the proportion of people in the population with any characteristic. If you asked fair haired people to go to one end of a room and dark haired people to the other, that would not change the proportion with any particular hair colour in the room. As the study of the experience of poverty in different countries with which we started this blog made clear, we are highly sensitive to social status differences. The social gradients in different problems are largely the result of status differentiation itself.
Some commentators suggest that poverty is not the result of low incomes but of things like addiction, mental illness, poor education or imprisonment. But the truth is that these are primarily the effects of the stresses of inequality, and particularly of being on the wrong end of it. You cannot read of the feelings of shame, of failure, of being disrespected and seen as inferior experienced by people in poverty, without understanding why it leads, as the data shows it does, to more depression, mental illness, addiction and imprisonment. And those additional difficulties will often lead to job loss, homelessness, and lower self-efficacy. Struggling on an income so inadequate that it denies you what is seen as a respectable way of life feels as if it almost broadcasts your inferior status.
By reducing inequality, we could not only reduce the powerful contribution it makes to poverty, but also weaken the damaging grip of class and status differences on us all.