Eldar Shafir and the concept of Scarcity

Radio 4’s Analysis conducted a fascinating interview with Eldar Shafir, professor of psychology and public affairs at Princeton University, last week. Co-author of the book “Scarcity: Why Having Too Little Means So Much, Shafir was being interviewed in front of a live audience at Oxford University, and discussed how scarcity of time and/or money impedes peoples ability to make good decisions.

A key aspect of his thesis is that poor people make bad decisions about their financial health not because they are not capable of making better decisions, but because their cognitive capacity (their mental bandwidth) is being occupied by thinking about more immediate priorities — securing childcare, finding employment, finding enough money for food and rent, etc.

It’s an enlightening interview, and his theories on how to enable people to make better decisions, particularly with regard to their financial circumstances, offer exciting new possibilities for our lives and society.

You can listen to the interview on the Radio 4 website.