top of page

Take Me To EVENTS page

What Can Behavioral Economics Tell Us About Depletion and Decision Making?

Woman on unicycle balancing life responsibilities

This post continues our new blog series on poverty. As our nation reflects on its progress in fighting poverty over the last 50 years, this blog series will highlight how psychology can contribute further to this discussion.

By Ramani Durvasula, PhD, (Member, APA Committee on Socioeconomic Status

The 2013 HBO film Paycheck to Paycheck features the story of Katrina Gilbert, a single mother of three children and nursing assistant who is chronically one paycheck away from disaster. The competing demands of a low paying job, children, health problems, rent, food, bills, and life create a taut story. It’s not unlike watching someone traverse a tightrope, and waiting for them to fall. The scene that had the most power forced me, and likely many others, to grapple with how we view decision making about resource allocation. In a strategic sequence of scenes, after a tough day at work, childcare issues, and relationship issues, we see Ms. Gilbert decide not to purchase some prescription medications (for $75) for chronic health conditions because of their cost. But then, we cut to a scene in a hair salon where she spends $87 on hair color and styling.

Like it or not, the faces of the people in the room where we screened this film betrayed some level of judgment, and even I found myself questioning her choice in that moment. But then I paused – and wondered: How many times can a person say no – before it takes a toll?

Princeton University researchers Eldar Shafir and Sendhil Mullainathan take this issue on headlong – noting that scarcity of anything (love, food, money) makes us less mentally efficient. They refer to a concept called “mental bandwidth” – and simply put – scarcity depletes this bandwidth. With less bandwidth we lose the cognitive stuff that helps to manage our day-to-day affairs, planning, and solving problems big and small. Chronic deprivation can keep shaving away at bandwidth so we can’t engage in these essential daily tasks, and thus we witness decision-making that looks downright self-defeating. The same “mistakes” get made day after day.

Poverty strips away margin for error. In the presence of resources – not only is there more bandwidth, the consequences of errors are less severe. Poverty makes it less likely that a person can “recover” from a mistake. A vicious cycle sets in whereby more scarcity begets fewer cognitive resources (less bandwidth) – and less ability to attend to all aspects of life – children, work, self-care.

Our culture tends to blame the poor – we were weaned on the belief that this is the land of opportunity, meritocracy and the ethos that hard work will ensure you will be able to house, feed, and care for you and yours. When people miss that mark, and can’t pay the rent or keep food on the table – the knee jerk presumption is that of dysfunction. We wag our fingers and ask – “What is wrong with you?”

Shafir and Mullainathan’s work – while it is firmly grounded in cognitive and behavioral economics – is in fact about compassion. The steely reductionism of looking at this in terms of “bandwidth” – can actually turn the phenomenon of scarcity into a place of empathy. We all have those days – flat tire, leaky pipe, sick child – and have directly experienced the loss of bandwidth, and the numerous cognitive errors and loss of efficiency that follow. Many of us have the luxury of going to sleep after these “bandwidth-depleting” days, clearing our heads, and starting anew the next day, armed with resources (and bandwidth).

Poverty robs a person of being able to catch up – the mental energy devoted to dealing with scarcity, means a chronic loss of bandwidth. An endless lifetime of broken down cars, buses that never come, medical bills that can’t get paid, jobs lost because of competing caregiving responsibilities. Intersectionalities such as poverty, race, and gender only magnify these bandwidth depletions.

It is easy to pathologize the poor, and all of us – educators, researchers, and clinicians, must take a mindful moment to pay attention to why we think those living in poverty are living in poverty. Instead of making it about bad luck or bad values – maybe it is actually common ground – cognitive depletion. And this depletion is more pronounced for those who simply do not have enough. This is something we have all experienced, so we can all understand it. We must take this understanding into therapy rooms and classrooms and remain vigilant as to how we work with lower income students, clients and communities. We must pay attention to our own biases, our own assumptions.

Armed with this knowledge – we can work with our clients and students on building resilience and directly addressing scarcity rather than fomenting helplessness and futility. We as psychologists, must work with policymakers to devise programs that are less about punishment and more about mitigating these burdens (e.g., better childcare access for low income working mothers). The same call to arms can be issued to teachers, health care workers, and both public and private sector employers and employees.

This kind of cutting edge work on scarcity within our discipline can take behavioral economics from a place of science, and inform our clinical, educational, policy, and scholarly work on poverty from a place of empathy.


Shafir, E. & Mullainathan, S. (2013). Scarcity: Why Having So Little Means So Much. Times Books, NY.


Ramani Durvasula, PhD, is Professor of Psychology at California State University, Los Angeles, and a licensed clinical psychologist in private practice in Los Angeles. She is presently Principal Investigator of the NIMH funded Health Adherence Research Project.  She is also a widely featured television commentator on mental health issues on all major national television networks. Learn more at:

4 views0 comments


bottom of page