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

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 f...

Full description

Saved in:
Bibliographic Details
Published in:Journal of the Association for Consumer Research 2020-10, Vol.5 (4), p.365-376
Main Authors: Mani, Anandi, Mullainathan, Sendhil, Shafir, Eldar, Zhao, Jiaying
Format: Article
Language:English
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary: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.
ISSN:2378-1815
2378-1823
DOI:10.1086/709885