Scarcity and Cognitive Function around Payday: A Conceptual and Empirical Analysis | Zendy

Anandi Mani | Zendy; Sendhil Mullainathan | Zendy; Eldar Shafir | Zendy; Jiaying Zhao | Zendy

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Scarcity and Cognitive Function around Payday: A Conceptual and Empirical Analysis

Author(s) -

Anandi Mani,

Sendhil Mullainathan,

Eldar Shafir,

Jiaying Zhao

Publication year - 2020

Publication title -

journal of the association for consumer research

Language(s) - English

Resource type - Journals

eISSN - 2378-1823

pISSN - 2378-1815

DOI - 10.1086/709885

Subject(s) - scarcity , cognition , consumption (sociology) , economics , water scarcity , empirical research , cash flow , function (biology) , psychology , public economics , microeconomics , sociology , geography , social science , neuroscience , evolutionary biology , biology , agriculture , philosophy , accounting , archaeology , epistemology

The ongoing demands around smoothing consumption with low and sporadic income flows in contexts of scarcity entail that minor changes in cash flows can have big psychological and behavioral effects. In this article, we examine the behavioral and cognitive impact of routine periodic fluctuations in financial status of the poor around paydays. In particular, we draw a link between a range of documented behaviors and an increase in scarcity-induced cognitive load, closer to payday. Our results, along with those of others briefly reviewed, illustrate the outsized role in scarcity contexts of otherwise trivial changes in income flows and highlight the importance of carefully structured research designs in studying the myriad challenges in scarcity contexts.

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