Experiment 1: Can debt lead to a false sense of abundance? Players will be randomly assigned to one of three groups:
1. The scarcity group (group S): Players will be given 30 blueberries; play will proceed as described above.
2. The scarcity with debt group (group SD): Players will be given 70 blueberries, but will be told that they start the game with a “debt” of 40 blueberries. Interest is zero, so these players have on net the same number of blueberries as players in the scarcity group. The game will stop automatically after the player has used thirty blueberries. Players will see the total (gross) number of blueberries they have available displayed on their screen, i.e., the number that includes the borrowed berries.
3. The abundance group (group A): Players will be given 70 blueberries; play will proceed as described above.
The scarcity hypothesis predicts that players in group S will focus more (spend more time aiming each shot) and use their available resources better (score more points per shot) than players in group A. If debt creates a false sense of abundance, I expect players in group SD to behave more similarly to group A than to group S, which will negatively affect their overall score.
Experiment 2: Does debt stress impact performance? All players will receive 50 points ($0.50) just for completing the survey (a show-up fee). Players will then be randomly assigned to one of two groups:
1. The scarcity group (group S): Conditions identical to those in experiment 1 for group S.
2. The scarcity with debt stress group (group SDS): Players will start the game with a 40 point ($0.40) debt. If they do not win at least 40 points during play, they will lose that amount from their show-up fee. This will be explained to them prior to the start of the game.
In this experiment, a false sense of abundance cannot affect performance, since debt in the form of points cannot be used (and therefore cannot be wasted), unlike debt in the form of blueberries. This is intended to generate, on a small scale, the anxiety over the potential for not being able to make payments that might be present for people with actual loans. If debt stress imposes a cognitive cost, then we would expect to see diminished points earned per shot for people in the SDS group. Ideally, this experiment would be identical to Experiment 1 in that players would start from zero rather than 50 points; however, since we cannot make players pay the researchers, the “show-up fee” ensures that players cannot end with negative points/take-home pay, even if they fail to make the 40 point minimum.
Experiment 3: Does mental accounting impact performance? Players will be randomly assigned to scarcity (S) or abundance (A) conditions, as in experiment 1, and then cross-randomized to one of two groups:
1. The mental accounting group (groups S-M and A-M): Players will be asked to remember something unrelated to the game, such as the date of a historical event. If they enter the wrong answer at the end of the game, they will be charged a 5 point penalty. This will be explained to them prior to the start of play.
2. The no mental accounting group (groups S and A): Conditions identical to those in experiment 1.
An alternative to the false abundance and debt stress hypotheses is the Ong et al. (2019) hypothesis that debt imposes a cognitive cost by requiring mental accounting. The requirement to remember an unrelated fact is intended to mimic the cognitive cost of having to remember that you owe 40 blueberries, without the potential confounding false abundance effect. I will test to see if the difference in performance between the S and SD groups in experiment 1 is similar in magnitude to the difference between the S and S-M groups in this experiment. If this difference also exists between the A and A-M groups, that will provide additional evidence to support the hypothesis that debt operates primarily through a mental accounting effect and not through a false sense of abundance.