Scarcity: Why Having Too Little Means So Much
Date posted: July 2, 2015
Why do successful people get things done at the last minute? Why does poverty persist? Why do organizations get stuck firefighting? Why do people worried about their finances have less control over their impulses? Sendhil Mullainathan, a behavioural economist, and Eldar Shafir, a cognitive psychologist, see these all as examples of a scarcity mindset.
Scarcity is not just a physical constraint. It is also a mindset. When scarcity captures our attention, it changes how we think – whether it is at the level of milliseconds, hours, or days and weeks. By staying top of mind, it affects what we notice, how we weigh our choices, how we deliberate, and ultimately what we decide and how we behave. When we function under scarcity, we represent, manage, and deal with problems differently. Some fields have studied mindsets created by particular instances of scarcity: how dieting affects mood, or how a particular cultural context might affect the attitudes of the local poor. We are proposing something much more universal: Scarcity, in every form, creates a similar mindset. And this mindset can help explain many of the behaviors and the consequences of scarcity. – p. 13
Bonus: Here’s a Ted Talk by Eldar Shafir that looks at some of the research behind this approach.