User:Abensss/Scarcity (social psychology)

= Scarcity (social psychology) = From Wikipedia, the free encyclopedia Jump to navigationJump to search Scarcity, in the area of social psychology, works much like scarcity in the area of economics. Simply put, humans place a higher value on an object that is scarce, and a lower value on those that are in abundance. For example diamonds are more valuable than rocks because diamonds are not as abundant. The scarcity heuristic is a mental shortcut that places a value on an item based on how easily it might be lost, especially to competitors. The scarcity heuristic stems from the idea that the more difficult it is to acquire an item the more value that item has. In many situations we use an item’s availability, its perceived abundance, to quickly estimate quality and/or utility.  These perceptions of scarcity can lead to behavior that is irregular of the consumer and at times atypically competitive.  This can lead to systemic errors or cognitive bias.

There are two social psychology principles that work with scarcity that increase its powerful force. One is social proof. This is a contributing factor to the effectiveness of scarcity, because if a product is sold out, or inventory is extremely low, humans interpret that to mean the product must be good since everyone else appears to be buying it. The second contributing principle to scarcity is commitment and consistency. If someone has already committed themselves to something, then find out they cannot have it, it makes the person want the item more.

Additionally, although people usually thing of scarcity in a physical manor, it is important to note that the 'product' in short supply can also be abstract ideas such as time or energy .

Examples
This idea is deeply embedded in the intensely popular “Black Friday” shopping extravaganza that U.S. consumers participate in every year on the day after Thanksgiving. More than getting a bargain on a hot gift idea, shoppers thrive on the competition itself, in obtaining the scarce product.

Another example of the effects of scarcity is the phenomenon of panic buying, which drives people to display hoarding behaviors when faced with the possibility of going without a certain product.

Hoarding
' Scarcity is also a considered by some to be signal that encourages hoarding behavior. Researchers have found that when consumers are faced with perceived scarcity, that they can become overwhelmed by the fear of need an item and not having it. This can lead to unnecessary buying and hoarding of items that are already in short supply. This in turn creates a cycle of scarcity in which people are so afraid of going without a needed item, they buy all they are able, thus furthering the actual scarcity of the item. '

Energy Consumption
' Another effect of scarcity is the amount of mental energy it consumes. Researchers Eldar Shafir and Sendhil Mullainathan claim that people living with constant scarcity suffer from a type of mental exhaustion that can manifest in the attention-span, self-control, and long-term planning abilities of those stuck in scarcity or poverty. The impact on these abilities can lead to severe consequences in behaviors such as financial decision-making and school performance.  '

Impulse Buying
' Impulse buying can also be a side effect of perceived scarcity. When people are faced with the possibility of having to go without an item, they often times will buy it, with no regard to whether or not it is actually needed. This, similarly to hoarding, often stems from a sense of urgency that develops then an item is perceived to be scarce.  '