Scarcity mindset

Scarcity mindset is a psychological phenomenon that occurs when we are faced with a limited resource. This resource can be money, time, space or even items going out of stock. When experiencing scarcity mindset, two parallel processes get activated. First, we experience an "attention dividend", where our attention gets hyper focused on solving for the scarce resource. We consider tradeoffs more clearly and scarce resources tend to be perceived as more valuable to us. Second, as a result of the attention dividend, we also experience a "cognitive tax". Since our cognitive resources are limited, we neglect other things happening around us that don't fall into our attentional tunnel, and struggle more with cognitive tasks.