Scarcity: Why Having Too Little Means So Much

In the Introduction, Mullainathan and Shafir draw from personal experiences and an array of anecdotes to illustrate the central theme of their book: Scarcity captures the mind, creating a singular focus that leads to narrow benefits in addressing immediate concerns, while also causing oversight and detrimental consequences in all other parts of life.

Mullainathan shares his own struggles with time scarcity, detailing how he became trapped within a vicious cycle of missed deadlines and postponed obligations. At the time, he told Shafir that he had a plan to get out: Mullainathan would simply avoid any new obligations and work meticulously to finish old ones. However, a week later, Mullainathan called Shafir to excitedly announce—without “even a trace of irony” (2) in his voice—a potential new obligation: Two of their colleagues were putting together a book on low-income Americans, and Mullainathan and Shafir had the opportunity to contribute a chapter. The two men took the opportunity, and they say that the observations and connections they made in writing the chapter for that book led to their work on Scarcity.

Mullainathan and Shafir share an excerpt from the notes they compiled while writing the chapter for their colleagues’ book. In this excerpt, they explore the concept of scarcity through the story of Shawn, a man entrenched in a cycle of debt. Mullainathan and Shafir then compare the story of Shawn to Mullainathan’s own struggles with managing time. After working on that chapter, the authors realized that, despite different contexts—financial debt for Shawn and time management for Mullainathan—the behaviors induced by scarcity are remarkably similar. Both individuals are caught in a cycle in which the immediate pressure of scarcity—whether it’s the need for money or time—leads to decisions that only exacerbate their situation.

This parallel draws attention to a broader, common logic of scarcity: It compels behavior focused on immediate needs to the detriment of long-term well-being, regardless of the specific form of scarcity. The authors suggest that this pattern of behavior, stemming from the fundamental experience of having less than one feels is needed, could have significant implications for understanding human behavior across various contexts of scarcity.

Mullainathan and Shafir’s interest in scarcity led them to review a study about hunger that was conducted toward the end of World War II (WWII). As the Allies advanced into German territory, they encountered people on the edge of starvation, and they didn’t know how to best feed them. A team at the University of Minnesota conducted an experiment on starvation, with 36 subjects participating in the study. Over the course of the study, not only did the participants’ bodies weaken, but their minds also changed: They became incredibly fixated on food. They became obsessed with cookbooks, food scenes in movies, careers in the food industry, and the prices of fruits and vegetables. For these men who were experiencing food scarcity, food became the primary focus of their existence.

Mullainathan and Shafir mention a more recent study in which participants were tested on their ability to identify words that were flashed up in front of them for 1/30th of a second. The hungry participants did better on food-related words. Mullainathan and Shafir point out that the time scale—1/30th of a second—means that scarcity captures the mind in a way that goes beyond conscious control. For the hungry participants, their minds were captured by a focus on food scarcity.

The authors give other examples of studies that show that scarcity alters perception. In one first study, which centered on poverty, children were asked to estimate the size of coins. Poor children estimated the coins as being larger, especially the coins that were of larger denominations. In a study on loneliness, subjects who were lonely showed a greater recall for social information. Together, these studies show that people experiencing scarcity demonstrate an outsized focus on what they lack—whether money, social interaction, or any other form of scarcity.

Mullainathan and Shafir then shift to discussing economics, acknowledging it as “the original science of scarcity,” since it deals with “how people and societies manage physical scarcity” (11). Economics traditionally focuses on the allocation of limited resources to fulfill unlimited desires, but the authors propose a unique perspective: While physical scarcity is common to all, the psychological experience of scarcity varies and is deeply influenced by individual perceptions of necessity. The authors extend the concept of scarcity beyond economic constraints, suggesting it induces a universal mindset that significantly impacts behavior across various life domains, such as dieting, poverty, and loneliness. They sum up their central argument by asserting that scarcity captures the mind, enhancing focus and efficiency in addressing immediate needs but also narrowing cognitive bandwidth, causing individuals to overlook other concerns and become less effective in other parts of their lives.

They conclude the chapter by emphasizing that scarcity research is an evolving field. They position their book as an introductory guide to a broader exploration of scarcity’s impact on human behavior, sharing that they incorporated anecdotes and vignettes into their writing to make it accessible to a wide audience. They invite readers along on a journey of discovery into this emerging field of study.