How do negative emotions affect our buying habits? A recent study looked into the effects of sadness on our willingness to spend. Participants, who had agreed to participate in the study for a ten dollar stipend, were divided into two groups. One viewed an emotionally neutral video about coral reef systems in Australia. The other watched a sad video about a young boy’s loss of his mentor. After viewing, each subject was offered the chance to trade some of the stipend for a sporty-looking water bottle. On average, the neutral group offered to trade 56 cents, and the group exposed to the sad video offered to trade nearly four times more, a startling $2.11. This “misery is not miserly” phenomenon has been reported before; in this particular example of it, the researchers concluded that “sadness can trigger a chain of emotions leading to extravagant tendencies…a willingness to pay more, presumably to feel better.”
A second study demonstrated that, contrary to traditional expectations, the intrinsic quality of an item is not the primary factor in how well we like it. Instead, it’s the expectation of quality which was related, in the participants’ minds, to price. Participants in the study were offered sips from five unmarked glasses of wine; the bottles ranged in price from five to ninety dollars. Their responses to the taste, specifically how much the brain’s pleasure center lit up, were registered directly with functional magnetic resonance imaging (FMRI). The more they were told a wine cost, the better they liked it, regardless of the actual quality of the wine! Thus $5 wine actually tasted better than $90 wine—if the drinker believed it was the more expensive, and therefore, higher quality wine. Overshoppers, who often relate the presumed worth of an item with their own self-worth, are particularly vulnerable to overpaying as a way of shoring up feelings of inadequacy. The happiness that follows a pricey purchase may reflect this belief; “If I spend a lot, I’m buying high quality, and if I’m buying high quality, I must be worth a lot.”
Carrie Rattle is a Principal at BehavioralCents.com, a website for women focused on mind and money behaviors. She has worked in the financial services industry for 20+ years and hopes to inspire women to better prepare themselves for financial independence.