The chapter opens with an anecdote about Chef Amanda Cohen, whose culinary innovation under the time constraints of a cooking show, Iron Chef, serves as a metaphor for how scarcity can drive creativity and efficiency. Mullainathan and Shafir observe that when Cohen competed on Iron Chef, the pressure of the timed challenge focused her mind, forcing her to condense years of experience and hard work into the immediate output of a dish. The dish she created later became a famously popular dish at her restaurant.

Mullainathan and Shafir suggest that Cohen benefited from the time crunch. This “focus dividend,” as they term it, underscores the beneficial aspect of scarcity, in which limitations on resources like time lead to heightened productivity and inventiveness. The authors point out that psychologists have studied the benefits of deadlines in controlled settings. In one study, in which undergraduates were paid to proofread essays, one group was given a long deadline, and another group was given multiple, shorter deadlines. The group with tighter deadlines was more productive, late less often, found more typos, and made more money.

Mullainathan and Shafir collaborated with psychologist Anuj Shah to design an experiment to determine whether artificially created scarcity could produce a focus dividend in a lab setting. They designed a video game based on Angry Birds in which players shoot blueberries at waffles using a virtual slingshot. In the game, blueberries determined one’s wealth; the more blueberries a player had, the more shots they could take, the more points they could earn, and the better prize they could win. To create scarcity, they made some subjects blueberry rich (they were given six blueberries per round) and others blueberry poor (they were given three per round), The blueberry rich scored more points because they had more blueberries, but the blueberry poor were more accurate with their shots. The blueberry poor benefited from a focus dividend.

Mullainathan and Shafir then pivot away from the benefits of scarcity to discuss one of scarcity’s detrimental effects: tunneling. To illustrate this concept, they discuss firefighters, who have a high rate of death due to vehicle accidents. They tell the story of Brian Hunton of the Amarillo Fire Department who died in 2005 after he was flung out of the firetruck as it took a sharp turn. Deaths like Hunton’s could be prevented by seatbelts, but firefighters, who confront time scarcity on their way to a fire, overlook tasks such as fastening their seatbelts because they fall outside the “tunnel” of their narrow, intense concentration.

In other words, Mullainathan and Shafir argue that scarcity doesn’t just sharpen one’s focus; it leads to tunneling, a phenomenon in which one narrowly concentrates on immediate needs at the expense of peripheral concerns, affecting one’s decision-making. This tunnel vision can cause one to overlook or undervalue important aspects and opportunities that lie beyond one’s immediate focus, altering how one perceives and evaluates long-term benefits.

The concept of inhibition plays a central role in explaining the mechanics behind tunneling. Mullainathan and Shafir describe how focusing intensely on one goal can inhibit one’s ability to consider other goals or even recognize important information unrelated to one’s immediate focus. This tunneling effect, while it can enhance one’s performance in specific tasks, exacts a “tunneling tax” on our broader well-being and effectiveness.

The authors support their argument with evidence from studies showing that scarcity-driven focus leads to choices that, while optimizing immediate outcomes, can have detrimental long-term consequences. For example, the decision to multitask under time pressure can save time in the moment but often leads to poorer overall performance and higher risks, such as increased accident rates when driving and talking on the phone.

Mullainathan and Shafir reflect on the paradoxical nature of scarcity’s impact: While it can make people more efficient in the short term, it often leads to regrets and missed opportunities. The regret individuals feel for the effects of tunneling suggests a dissonance between short-term behaviors driven by scarcity and long-term values and goals.