"Thank you for coming to this urgent, last-minute meeting today," I say to you and seven of our mutual colleagues. Pointing to a plate of 10 cookies on the table between us, I explain, "We're in luck, though. As a reward for your willingness to squeeze this meeting in, I have managed to sneak some cookies out of the executive meeting next door!"

We all smile, and that look on your face tells me that you already feel better about this meeting than you did just minutes ago. As I drone on about the urgent topic of the meeting, your mind does the math. Counting you and me, there are nine of us. It doesn't take much to figure out that there is at least one cookie for everyone in the room. Your brain signals a salivary response and depending on your current blood sugar levels, possibly a preemptive insulin release from the pancreas.

In other words, you begin to act like that cookie is yours. If I were to survey you at that moment about how appetizing the cookies seem and how much you expect to enjoy yours, you and the others might collectively estimate the cookies at 6.5 on a scale from 1 to 10. Good cookies, to be sure.

That's when a knock is heard at the door and someone enters — a confederate of mine, though you don't know this — who explains that they made a mistake in letting me take the cookies. In fact, the executives ran out of cookies, and they need eight of them back. I apologize, take two cookies from the plate and put them on a napkin for us to keep. My confederate leaves the room with the eight other cookies.

If I survey you now and ask you how appetizing the two cookies left on the table appear, what do you think happens to your estimate? If you guessed that your desire for the cookies goes up, you are in tune with human nature. Indeed, the average score for the cookies will be higher, coming in at more like 7.5, even though the cookies did not change.

What counts for the sudden fondness for baked goodness? Scarcity. The implied competition for the remaining cookies will cause you to elevate your desire for the cookies. Barring any allergies or other food preferences, most people will suddenly find their interest in the cookies rise.

Scarcity works that way: Its effects are immediate and irrational. Notice that not a single one of the people in that room with you actually needs that cookie to survive or for any other meaningful purpose. You can get an equally nice cookie yourself at very minimal cost on your way home from work. But that knowledge doesn't stop you from valuing the cookie in the short run higher than before just because it's now a scarce commodity. It's even more interesting than that. If I tell you that the reason the cookies have to go back to the executive meeting is that they loved the cookies so much that they wanted seconds, you'll value the cookies even higher. It's because you now have evidence that people you identify with (or aspire to identify with) value them as well. If I were to go one step further and survey you about how much you like the executives, your appraisal of them would temporarily dip. This is because you perceive that they have deprived you of something you value.

And it's all for a plate of cookies that weren't even yours to begin with, cookies that you can easily substitute, cookies that aren't technically scarce, except for during the few minutes remaining in my urgent meeting.

Scarcity Is A Lie

Last week, I released a Forrester Report called "Brief: Digital Winners Know That More Is More." The report represents my latest thinking on how digital disruption will eventually overcome the economics of scarcity. As I've maintained since before I wrote the book Digital Disruption, the economics of digital are fundamentally additive. The smartest companies — digital disruptors — exploit the efficiency of digital technology to give people more for less. They earn outsized returns for doing so. Even while I was finishing up the book in late 2012, companies like Uber and Airbnb were causing their initial buzz in Silicon Valley with their digitally efficient business models. 

As I write in my report, Uber has gone on to stretch even my understanding of just how economically expansive a digital disruptor can be. Uber not only uses existing technology — your phone, your driver's car, and Google Maps — to deliver better services at lower cost, it actually grows the entire transportation pie. The result is Uber drivers in Boston who drive teens to after-school sports events and UberX drivers in San Francisco who make a few bucks driving strangers to work during their own commutes. All of this expands the entire market in a way that inspires still others to invest in transporation and logstics. Consider Wal-Mart's entry into drone delivery, or Starship's testing of sidewalk robots that can bring your groceries to your door. 

Digital markets are getting bigger, consumer benefits are cheaper to come by, and, in aggregate, life is better in nearly every measurable way. (Don't believe that? You just proved my point. See my report endnotes for the evidence.)

"But, James, if things are all awesome, why is everybody so down these days?" It's the cookie. No matter where we look, most of us see a cookie that was taken from us — whether bankers did it, whether immigrants are still doing it, whether the greedy oil companies took it, or whether pro-choice groups are threatening to take it. It all adds up to the same result: A cookie we believe was ours was taken from us. Or it will be. Why we thought the cookie was ours in the first place is an intriguing question, but regardless, the perception of scarcity is all it takes to make us act as though the thing we lost was the most valuable thing in the world. Our tendency to think in terms of scarcity is called a zero-sum mindset. In this mindset, to get the cookies that are owed us we must take them from a limited supply. Thus, someone else won't get a cookie. Conversely, we believe that when someone else gets a cookie, it means we might not get one. 

Because everything we want seems scarce — energy, air, water, jobs, money, housing, or a good seat at a trendy restaurant — we compete for resources, we resent people who want the same resources we do, and we use our minds to construct explanations for why we deserve resources that others do not. This is true in the first person and in the third person. We work to protect resources for ourselves, but we also appoint ourselves protectors of groups we perceive are vulnerable and advocate for them with moral force. We're humorously predictably this way. But it's not funny to what lengths we'll go to enforce our scarcity-based mindset. We carefully compile evidence to back up our beliefs that bankers are bad, immigrants are the root of all evil, or some group (e.g., gun owners, transgendered people) will cause us or the people we advocate for direct harm very soon.  

Can You Embrace The Economics Of Abundance?

The zero-sum mindset is a mindset and as such can be overcome if we put our minds to it. We can choose to act as though abundance is the order of the day. And if we did, we would be right. Empirically speaking, we have more of just about everything that we value than ever before, and we can expand it even more by using digital technology to give people more of what they want, more easily, and at lower cost. That's how Elon Musk thinks even as he builds some of the most expensive cars in the world — he builds free supercharger stations for Tesla owners. Meanwhile, Detroit automakers complain to the government that somebody (meaning the taxpayer) has to invest in charging stations before electric vehicles can have any hope of taking off. Sigh. Tesla just presold more than 400,000 Model 3's, which are more vehicles than BMW, Lexus, or Mercedes sell in the US in even the best years. But major automakers claim that electric vehicles can't take off until somebody else invests in the infrastructure to support them? Meanwhile, auto execs I met with recently bristle visibly when I bring up Tesla, insisting that the company "can't last." Frankly, it doesn't matter to me if Tesla exists in the future. The abundance-based mindset it lives by will determine who wins in the future.

This is just like what happened nearly two decades ago when traditional retailers complained that the free shipping and no-hassle return policies of rising online retailers were unsustainable. But now it's the standard by which all online retail is measured, and the company that pioneered this thinking — Amazon — recently became the fastest company in history to reach annual sales of $100 billion. 

More is more, even if you are so focused on the cookies you don't have that you don't notice it. I wonder what would happen if you just stopped mourning that cookie and went out and came up with your own tasty treat.