Sunday, November 24, 2013

On "Scarcity" by Mullainathan and Shafir

Here’s the bottom line.  Not having enough is bad. It is not just the absence of material goods, but also the price is paid in cognition.  If you are worried about want, part of your mind is taken up by that need.  You are quantifiably less intelligent, and you make poorer decisions because your mind has no slack.

If possible, you can make yourself more efficient by planning for this scarcity in mental attention.  The authors use for an example of a busy hospital.  They were always off schedule and ended up paying more in overtime because they were so busy.  An outside consultant fixed that problem by setting aside one operating room for emergency surgeries.  Even though that room could be empty at times, having that slack helped the hospital operate more efficiently.  Your everyday life works the same way.  From what I see, the problem is now how to get to there from here.