Abstract
According to psychological research, scarcity increases an object's desirability. Although inconsistent with the assumptions of formal economic theory, this effect of scarcity may be attributable to people's naive (or informal) economic theories. More specifically, scarcity's enhancement of desirability may be mediated by the belief that scarce things are more expensive than available ones. Existing research relevant to this explanation for the effects of scarcity, as well as the implications of this explanation for future research, are discussed.

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