Carpe Diem: The Problem of Scarcity and Abundance

Previously: Carpe Diem: The Optimization Game: Level 1

One of my goals with Carpe Diem was to illustrate the value of flexibility and optionality, and the surprisingly high cost of scarcity. A simple plan for playing the game is to maintain an exchange rate between time, money and victory points, and choose the most efficient set of options each turn. This is far better than what most players I have observed do, which is to fall into a scarcity trap.

The game is designed to spring this trap on you as early as the second turn. On turn one, there’s frequently an opportunity to score victory points, but since you start with only $8, scoring costs $5 and expenses cost $4, that is likely to leave you very close to broke when the turn is over. Then on turn two, players find themselves unable to take advantage of new opportunities, because they don’t have enough money (or energy, which also starts low) to do so, or they’re forced to pass up good sources of money in order to score the new card, leading to the same problem on turn three.

Once you start to experience a scarcity trap, it becomes self-perpetuating. You tunnel, ignoring your long term needs and how many other resources you’re expending, including future quantities of what you’re short of today, in order to fulfill today’s needs. Your scramble for resources this turn leads to another shortage next turn, so you’re constantly falling further and further behind. A small change in initial endowment can end up making a huge difference even though there is no direct mechanism to earn interest on what you’ve saved.

Most people don’t only fall into the scarcity trap, they also fall into the abundance trap, and then oscillate between the two, or can even be in both modes at the same time, if they have a shortage of one resource and an abundance of another. The abundance trap is where you have more money (or more anything else) than you need right now, so even though you know you’ll eventually be short on money, you don’t worry too much about how much money you’re spending until you start running low.

These dynamics are discussed at length in the book  Scarcity: Why Having Too Little Means So Much . The book makes some very good points that everyone should know, and makes them well, but like many such books makes them over and over again where a more concise slash less repetitive version would do nicely. It’s less bad at this than average, but still not great. Almost all popular books of this type do it, so presumably there isn’t much of an alternative.

MetaMed definitely could have benefited from more insight into this issue, and from what I’ve seen we got off relatively light: most other startups (and likely most other businesses) suffer from the issue far more than we did.

The key to getting a strong average score in Carpe Diem’s original version, in addition to having a good idea of what the right default exchange rates are, is to value money and energy highly whenever you don’t have a buffer, up until the last few turns of the game. That way, you guard against being unable to take advantage should opportunity knock, which is far more costly than turning down marginal early opportunities.

This matches my real life experience. Every now and then, you’ll have an opportunity to get great leverage on your money, your time, your energy, your friends, your internet connection, and so forth. Most days, the value of free time is relatively low, and can even be negative (“I’m bored!”), but when you need that time, you really need it. Money isn’t that important most of the time, but when you need it and don’t have it, it’s really bad. Most of the time being low energy, or not having as many friends as you’d like, or having a spotty internet connection, is mostly harmless, but at the wrong time it can spell disaster.

Using time now to save time later is often efficient even if you spend more time than you save, because that time later on might be orders of magnitude more important. I’m experimenting with a variation where the player has a job, rather than working freelance, to illustrate how these dynamics can work. Your goal isn’t to end the game, or your life, without unspent resources – your goal is to make those resources count.