Featured Research

from universities, journals, and other organizations

When self-esteem is threatened, people pay with credit cards

Date:
May 6, 2011
Source:
SAGE Publications
Summary:
People shop for high status items when they're feeling low, and they're more likely to make those expensive purchases on credit, according to a new study.

People shop for high status items when they're feeling low, and they're more likely to make those expensive purchases on credit, according to a study in the current Social Psychological and Personality Science (published by SAGE).

Related Articles


When a person's ego is threatened -- by doing poorly on a task, by being told they're not as good as they hoped -- people sometimes repair their self-worth by purchasing luxury goods. Because actually parting with cash can be psychologically painful, researchers Niro Sivanathan of the London Business School and Nathan Pettit of Cornell University studied whether people might be more likely to use a credit card when feeling badly about one's self.

The researchers had people work on an ambiguous computer test, and then told half of them that their "spatial reasoning and logic ability was in the 12th percentile," which is a scientific-sounding way of telling them they're not very smart. They told the other half that they were in the 88th percentile, a perfectly fine performance. When asked how they might pay for "a consumer product that you have been considering purchasing," people who'd had their ego threatened were substantially more likely to say they were planning on paying on credit.

In a follow-up study, Sivanathan and Pettit asked 150 college students to think about buying a pair of jeans. Half were told to consider a pair of exclusive, high status designer jeans, while the rest were told to think about normal, everyday jeans. The students then went through the same computer test, and were told they had done poorly or well. The self-esteem threat made people willing to pay almost 30% more for the luxury jeans, and were more than 60% more likely to intend to purchase the jeans with a credit card.

Does threat make any purchase look good, or are luxury items particularly good at repairing self-esteem? The students who thought about everyday jeans did not increase how much they would pay for regular jeans when threatened, and the threat did not change their willingness to use credit over cash. Luxury items are especially effective at reassuring us of our value.

People are likely to resort to credit after threat to consume luxury goods, despite the interest and fees associated with consumer credit. Seeking luxury after threat, the researchers note, is a normal response. These studies are part of a psychological account of how relaxed lending policies -- for example high interest mortgage offers aimed at consumers of low socioeconomic status -- can have disastrous consequences.


Story Source:

The above story is based on materials provided by SAGE Publications. Note: Materials may be edited for content and length.


Journal Reference:

  1. N. C. Pettit, N. Sivanathan. The Plastic Trap: Self-Threat Drives Credit Usage and Status Consumption. Social Psychological and Personality Science, 2010; 2 (2): 146 DOI: 10.1177/1948550610385138

Cite This Page:

SAGE Publications. "When self-esteem is threatened, people pay with credit cards." ScienceDaily. ScienceDaily, 6 May 2011. <www.sciencedaily.com/releases/2011/05/110505181541.htm>.
SAGE Publications. (2011, May 6). When self-esteem is threatened, people pay with credit cards. ScienceDaily. Retrieved October 31, 2014 from www.sciencedaily.com/releases/2011/05/110505181541.htm
SAGE Publications. "When self-esteem is threatened, people pay with credit cards." ScienceDaily. www.sciencedaily.com/releases/2011/05/110505181541.htm (accessed October 31, 2014).

Share This



More Mind & Brain News

Friday, October 31, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Studying Effects of Music on Dementia Patients

Studying Effects of Music on Dementia Patients

AP (Oct. 30, 2014) The University of Wisconsin-Milwaukee is studying the popular Music and Memory program to see if music, which helps improve the mood of Alzheimer's patients, can also reduce the use of prescription drugs for those suffering from dementia. (Oct. 30) Video provided by AP
Powered by NewsLook.com
Techy Tots Are Forefront of London's Baby Show

Techy Tots Are Forefront of London's Baby Show

AP (Oct. 28, 2014) Moms and Dads get a more hands-on approach to parenting with tech-centric products for raising their little ones. (Oct. 28) Video provided by AP
Powered by NewsLook.com
Cocoa Could Be As Good For Memory As It Is For A Sweet Tooth

Cocoa Could Be As Good For Memory As It Is For A Sweet Tooth

Newsy (Oct. 27, 2014) Researchers have come up with another reason why dark chocolate is good for your health. A substance in the treat can reportedly help with memory. Video provided by Newsy
Powered by NewsLook.com
Five-Year-Olds Learn Coding as Britain Eyes Digital Future

Five-Year-Olds Learn Coding as Britain Eyes Digital Future

AFP (Oct. 27, 2014) Coding has become compulsory for children as young as five in schools across the UK. Making it the first major world economy to overhaul its IT teaching and put programming at its core. Duration: 02:19 Video provided by AFP
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:

Breaking News:

Strange & Offbeat Stories


Health & Medicine

Mind & Brain

Living & Well

In Other News

... from NewsDaily.com

Science News

Health News

Environment News

Technology News



Save/Print:
Share:

Free Subscriptions


Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

Get Social & Mobile


Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

Have Feedback?


Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
Mobile: iPhone Android Web
Follow: Facebook Twitter Google+
Subscribe: RSS Feeds Email Newsletters
Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins