Mindset of abundance versus scarcity
Also known as: Scarcity mindset
Feeling that a vital resource is in short supply captures the mind and reshapes how we think and choose.
What it means
The scarcity mindset is the psychological state induced when people feel they have too little of something they need — money, time, food, or social connection — which captures attention and reorganizes cognition around the lack. Scarcity confers a narrow 'focus dividend,' sharpening engagement with the pressing shortfall, but it does so by 'tunneling,' which neglects matters outside the tunnel and taxes mental bandwidth, reducing the cognitive capacity and self-control available for other decisions. This bandwidth tax helps explain why poverty is associated with choices that look short-sighted: the condition itself, not the person, consumes mental resources. The nuance is that scarcity is a context-induced mindset rather than a fixed trait, so the same person reasons differently when resources are tight versus slack. It matters because it reframes many 'irrational' behaviors of the time-poor and cash-poor as predictable consequences of depleted bandwidth.
Examples
Preoccupied with an overdue bill, a person fixates on this month's cash and overlooks a far costlier looming expense, while their depleted focus makes other decisions sloppier.
A manager buried in this week's deadline handles it brilliantly, lets a hiring decision drift, then makes it badly in five minutes — the deadline had taken all the bandwidth.
A dieter's day narrows around the next meal: she spots calorie counts on every packet yet forgets the appointment in her own calendar, the tunnel closing around food.
First described in Sendhil Mullainathan & Eldar Shafir (2013).