נושא: The Effects of Scarcity on the Exploration–Exploitation Tradeoff

Britt Hadar

Reichman University

The Effects of Scarcity on the Exploration–Exploitation Tradeoff

Everyday decisions often involve a tradeoff between exploiting familiar options and exploring unfamiliar ones. This research examines how perceived scarcity—of money, time, or other essential resources—shapes this fundamental tension.

Across multiple contexts, we find that scarcity reduces people’s willingness to explore new options, even when doing so might ultimately lead to better outcomes. This effect is not explained by changes in how people evaluate unfamiliar options, but rather reflects a broader shift in decision-making strategy under constraint. These findings offer insight into how resource limitations can subtly but systematically alter behavior, with implications for consumer choice, organizational decision-making, and public policy.