If there’s one thing fashion has mastered over the years, it’s the art of making people want what they can’t have. Limited editions, capsule collections, and “drops” — these words have come to define the modern fashion landscape. But why do we get so excited about items that are purposely made scarce? The answer lies at the intersection of economics and human psychology.

Let’s break it down. At its core, the concept of scarcity is one of the oldest tricks in the book. Economics tells us that scarcity influences consumer behaviour by creating a sense of urgency and perceived value. When consumers perceive a product to be scarce, or rare, they attach a higher value to it. This is why diamonds are so expensive, or why vintage clothing can sell for hundreds — even thousands — of dollars. Fashion brands are aware of this, and some of turned it into a powerful marketing strategy. By releasing limited-edition items, brands establish an air of exclusivity and urgency, encouraging consumers to act fast before the product sells out.

Take streetwear brands like Supreme, for example. Their “drop” culture — where collections are released in small, limited quantities — has turned shopping into a high-stakes competition. It’s not just about buying clothes; it’s about being part of an exclusive club. Owning a limited-edition piece becomes a status symbol, a way of signalling that you’re in the know. Think about it. If there’s only a small number available worldwide, and forever, wouldn’t you want to be apart of it too? This has turned once niche brands into global powerhouses, with resale markets exploding as people scramble to get their hands on these scarce items.

But this love affair with scarcity has extended to luxury fashion houses, who have been using this tactic for years. From Louis Vuitton’s limited-run handbags to Hermès’ famously hard-to-get Birkin bags, scarcity has long been part of luxury fashion’s DNA. The fewer items available, the more coveted they become.

While this strategy makes economic sense for brands, it does raise questions about sustainability. The constant release of limited-edition collections encourages consumerism, often at the expense of thoughtful, long-lasting purchases. The question remains: can the industry balance its love of exclusivity with a commitment to responsible production?