The Psychology of Scarcity

Awarded Scholars:
Eldar Shafir, Princeton University
Anuj Shah, University of Chicago
Abby Sussman, University of Chicago
Jiaying Zhao, University of British Columbia
Project Date:
Dec 2014
Award Amount:
$129,062
Project Programs:
Behavioral Economics

Recent research has shown that poverty leads to profound shifts in the mindset and psychology of individuals. Living in contexts of scarcity, not having enough of a critical resource, focuses our thinking on the scarce resource but distracts from other things. Juggling poverty, or any other form of resource scarcity, burdens our mental capacities and leaves less mind for other concerns. As a result, the psychology that emerges in contexts of scarcity has profound implications for what kind of interventions might or might not work.

Psychologists Eldar Shafir, Anuj Shah, Abby Sussman, and Jiaying Zhao propose to use a mix of laboratory experiments, quasi-experimental surveys, and field studies to further research and develop a psychological model of what it means to have too little. Specifically, they plan to design interventions that examine the psychological burdens of poverty, cognitive bandwidth in low-income individuals, and performance and decision-making.

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