Scarcity or Abundance – It’s Your Choice

Have you ever gone to the grocery store when you’re hungry and ended up buying all kinds of things that weren’t on your shopping list? Ever noticed how when you’re on a diet every single ad seems to feature something delicious you’re not supposed to eat? Or have you ever been a little bit down on your luck and bought something you couldn’t afford, because you convinced yourself it was just too good a deal to pass up, or something you absolutely “needed?”

You’ve been the victim of “scarcity thinking.” Originally documented in cognitive psychology, the scarcity effect is a well-known principle in economics and marketing, used to predict buyer behavior. When something is perceived to be in limited supply, we tend to place a higher value on it. That’s why you’ll see ads on late-night TV say things like “Order now! Only five minutes left!” Our brains can do funny things under stress, and the scarcity effect generates a highly stressful experience. Because we are hard-wired to survive, a scarce resource gets our attention.

Scarcity Makes You Temporarily Insane

You can see how scarcity in the wild could heighten competitive instincts, force animals to seek out, even hoard food, water, shelter – whatever potentially life-saving resource that has become scarce.

But we humans, we take scarcity thinking to a higher level. Once we start to see something as scarce – even if we didn’t want it previously – we feel afraid of missing out. We get more and more anxious, until we become so stressed out that we become cognitively impaired. When a toy becomes so popular that stores can’t keep enough supply to meet demand, parents sometimes do crazy things. The Cabbage Patch kids craze is a great and terrifying example. Parents became violent, trying to get the perfect Christmas present for their children. Scarcity creates a sort of short-term insanity. Studies show that people under the pressure of scarcity thinking begin to make poor decisions, even score lower on classic intelligence tests. Once the pressure is removed, these subjects returned to their previous control levels of cognitive performance.

Scarcity Thinking Can Have Long-Term Effects

The temporary effects of scarcity thinking often go away once the crisis is over, but what if you’re living under scarcity as a way of life? This is the reality for people below the poverty line, refugees in a war-torn state, or anyone who lives under the constant threat of scarcity for a prolonged period. Eventually, the stress physically harms your brain, leaving lasting effects that can be measured in lower IQ scores, weakened reasoning abilities and other losses that only exacerbate the problem.

Scarcity Thinking Makes Us Do Counter-Productive Things

Not only do we get a little crazy under the influence of scarcity, we tend to develop the exact type of crazy most likely to make matters worse. The more urgently scarce something is, the worse we get at thinking about it, which begins a terrible spiral into worse and worse decisions. In their book, Scarcity, Mullainathan and Shafir explore a wide range of people experiencing the effects of scarcity. Poor farmers in India take less care of their crops in bad growing seasons than when crops are doing well. Lonely people seeking love in a series of doomed relationships. Very busy people booking back-to-back meetings that only make them farther and farther behind. We’ve all been there at least once or twice.

And we can all thank our crazy, survival-obsessed brains for this self-defeating pattern!

Fighting the Scarcity Effect

Fortunately, we can also pull ourselves out of this dangerous spiral. Here are a few tips:

Recognize what is happening. If you’re feeling stressed out because you don’t have enough of something, take a step back and evaluate your situation. If you feel like you’re getting a lot of “bad luck,” take a hard look at your recent decisions. You may find that you’re making all sorts of terrible decisions because you’re reacting to the stress of scarcity.

Practice Abundance Thinking

The opposite of scarcity is abundance. When the brain perceives that we have an abundance of something we need, we tend to get even better at getting and keeping it. Sales professionals write more proposals and make more sales calls after they’ve made quota then when they’re behind. Overweight people make better good choices when they aren’t on a diet. Sports professionals become better and better at winning the more they win.

Sometimes, it just takes a little effort to remind yourself that you have an abundance of something. You may not have a lot of money, but you can celebrate having a roof over your head, or the meal you’re about to eat. You may not be able to give your kid the hottest toy right now, but you can give him an abundant supply of your love. This type of thinking may sound trite, but it works. Your brain pays attention to self-talk. If you tell yourself that you have everything you need, that things are looking up, that you’re happy, your brain responds. I’m not talking about somehow manipulating the world to fit your desires. Abundance thinking doesn’t make you a millionaire; but it might inspire you with enough positive energy to go out and win a new client or find a new job.

Give Something Away. When we’re generous, our brain rewards us with great feelings. Think you’re too busy? Give some time to someone who needs your help. Too poor? Give a small amount to a cause that you care about. Feeling a little down? Find a way to make someone else smile.

We all go through times of scarcity and fear; we just don’t have to let those times rule us or change us from who we are.

“Abundance is about being rich, with or without money.”
—Suze Orman

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s