Cash-on-hand can raise productivity for low-income workers | MIT Sloan

An article in MIT Sloan’s Ideas Made to Matter outlines research by CEGA affiliate Supreet Kaur which suggests that financial pressures actually impair worker productivity, with important implications for current debates around unemployment and social welfare in light of the global toll of COVID-19:

“A new study with three colleagues — Supreet Kaur from University of California Berkeley, Suanna Oh from the Paris School of Economics, and Sendhil Mullainathan from the University of Chicago — gets to the heart of this question: Do the pressures of poverty impair worker productivity?

The upshot: yes. In an experiment, the researchers found an average 6.2% jump in productivity when workers were paid partway through a job instead of when the job was complete. The results are detailed in the working paper ‘Do financial concerns make workers less productive?'”

Source: Study: Cash-on-hand can raise productivity for low-income workers | MIT Sloan