Tightwads and Spendthrifts

Rick, Scott; Cryder, Cynthia; Loewenstein, George

doi:10.2139/ssrn.898080

Cited by 87 publications

(170 citation statements)

References 51 publications

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“…McClure et al 2004), but rather implicitly captured by prices, participants appear to rely on an anticipatory pain of paying to deter their spending, rather than strictly on a deliberative consideration of what is foregone by purchasing immediately. 3 In other research conducted with Cynthia Cryder (Rick et al 2008), we have been examining chronic behavioural consequences of the pain of paying. As touched upon above, because people are not making explicit trade-offs, it is difficult to 'get it right' and it is easy to get it wrong in either direction.…”

Section: Spending and Savingmentioning

confidence: 99%

“…We find that tightwads and spendthrifts behave most similarly when situational factors diminish the pain of paying. In one study, for example, we (Rick et al 2008) asked tightwads and spendthrifts whether they would (hypothetically) be willing to pay $5 to have DVDs shipped to them overnight, rather than waiting four weeks. We simply varied whether the cost of shipping was framed as a '$5 fee' or a 'small $5 fee'.…”

Section: Spending and Savingmentioning

confidence: 99%

“…Prelec & Loewenstein's (1998) model, itself motivated by behavioural research, later inspired the neuroeconomic research of Knutson et al (2007), which, in turn, motivated Rick et al's (2008) behavioural work. As noted above, subsequent research could generate further insight into the pain of paying by examining whether drugs that reduce pain and anxiety affect different consumers differently.…”

Section: Spending and Savingmentioning

confidence: 99%

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Intangibility in intertemporal choice

Rick

Loewenstein

2008

Phil. Trans. R. Soc. B

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Since the advent of the discounted utility (DU) model, economists have thought about intertemporal choice in very specific terms. DU assumes that people make explicit trade-offs between costs and benefits occurring at different points in time. While this explicit trade-off perspective is simple and tractable, and has stimulated productive research, it does not provide a very realistic representation of a wide range of the most important intertemporal trade-offs that people face in daily life. If one considers the most important and commonly discussed examples of intertemporal choices, a striking pattern emerges: in almost all cases, early outcomes tend to be concrete (e.g. purchasing this latte), but later outcomes tend to be much less tangible (e.g. the unknown item that could have been purchased later with the money spent on this latte). We propose that people rely on anticipatory emotions as a proxy for intangible outcomes when trade-offs are implicit. This paper reviews neuroeconomic evidence that has begun to elucidate the role of anticipatory emotions in decisions involving intangible outcomes. Although most progress has been made in the domain of spending and saving, we discuss how the existing neuroeconomic research could be extended to other domains where trade-offs are ill defined.Keywords: neuroeconomics; behavioural economics; intertemporal choice; tangibility; consumer behaviourThe qualities most useful to ourselves are, first of all, superior reasons and understanding, by which we are capable of discerning the remote consequences of all our actions, and of foreseeing the advantage or detriment which is likely to result from them; and, secondly, self-command, by which we are enabled to abstain from present pleasure or to endure present pain, in order to obtain a greater pleasure or to avoid a greater pain in some future time. In the union of those two qualities consists the virtue of prudence, of all the virtues that which is most useful to the individual. Smith (1759Smith ( [1981), pp. 271-272, Theory of moral sentiments.

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Section: Spending and Savingmentioning

confidence: 99%

Section: Spending and Savingmentioning

confidence: 99%

Section: Spending and Savingmentioning

confidence: 99%

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Intangibility in intertemporal choice

Rick

Loewenstein

2008

Phil. Trans. R. Soc. B

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“…This part was incentivized by paying one subject, randomly selected at the end of the experiment, 20 for each correct guess. The students also rated themselves on the spendthrift-tightwad scale (Rick et al 2008), which captures whether they feel that they have difficulty controlling spending or if they tend to hold on to tight to their money. The experiment ended with background questions including consumption habits for beer and coffee and payment habits.…”

mentioning

confidence: 99%

Do consumers pay more using debit cards than cash?

Runnemark

Hedman

Xiao

2015

Electronic Commerce Research and Applications

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We conduct an incentivized experiment to test whether the willingness to pay is higher for debit cards compared to cash for three consumer products. Our findings support this conjecture also after controlling for cash availability, spending type, price familiarity and consumption habits of the products. The evidence thus suggests that different representations of money matters for consumer behavior.JEL classification: D03; D010; E42

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“…The former implies that consumers prefer to reduce the number of monetary transactions (Prelec & Loewenstein 1998, Rick et al 2008. The latter, transaction costs, are well accepted to be part of every purchase.…”

Section: Bundles In Generalmentioning

confidence: 99%

Bundling Public with Private Goods

Frackenpohl¹,

Pönitzsch²

2015

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. i.e., the willingness to pay for the bundle exceeds the willingness to pay for the two separate goods. In contrast, we find no superadditivity in control treatments with only private goods. We discuss several behavioral concepts which are in line with our results as well as implications for fundraisers and firms. Terms of use: Documents in EconStor may

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Tightwads and Spendthrifts

Cited by 87 publications

References 51 publications

Intangibility in intertemporal choice

Intangibility in intertemporal choice

Do consumers pay more using debit cards than cash?

Bundling Public with Private Goods

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