Featured Research

from universities, journals, and other organizations

Are consumers with fewer friends more likely to take financial risks?

Date:
January 15, 2013
Source:
Journal of Consumer Research, Inc.
Summary:
Feeling socially isolated causes consumers to pursue riskier but potentially more profitable financial opportunities, according to a new study.

Feeling socially isolated causes consumers to pursue riskier but potentially more profitable financial opportunities, according to a new study in the Journal of Consumer Research.

Related Articles


"Seeking social acceptance and maintaining close relationships are among the most fundamental and universal human needs. Consumers are often willing to invest or sacrifice important resources to secure social bonds. In the absence of social support, consumers seek significantly more money to secure what they want out of the social system surrounding them. Feeling socially rejected triggers riskier financial decision-making," write authors Rod Duclos (Hong Kong University of Science and Technology), Echo Wen Wan (University of Hong Kong), and Yuwei Jiang (Hong Kong Polytechnic University).

Feeling alone or rejected is a common experience. Romantic relationships end, people are ignored at parties or in office conversations, and offers of friendship are frequently rebuffed. In the absence of social support, do consumers seek and value money as an alternative means to get what they want out of the social system? And does this lead to greater financial risk-taking?

In one study, consumers were asked to recall a social situation that left them feeling either included or excluded. They were then asked to choose between a set of high-odds/low-reward and low-odds/high-reward gambling options. Feeling rejected fostered riskier decisions. However, this effect was mediated by the perceived instrumentality of money. That is, in the absence of social support, excluded consumers started to seek and value money as an alternative means to secure what they want out of the social system.

"Given the necessity of balancing between risk and financial reward in many important financial decisions (saving for college or retirement, deciding how to pay for health care and insurance, investing in the stock market), understanding how consumers trade risk for reward could help them make more informed decisions. For example, consumers might choose to delay important financial decisions following a breakup or a falling out with friends, colleagues, or family," the authors conclude.


Story Source:

The above story is based on materials provided by Journal of Consumer Research, Inc.. Note: Materials may be edited for content and length.


Journal Reference:

  1. Rod Duclos, Echo Wen Wan, Yuwei Jiang. Show Me the Honey! Effects of Social Exclusion on Financial Risk-Taking. Journal of Consumer Research, 2012; 000 DOI: 10.1086/668900

Cite This Page:

Journal of Consumer Research, Inc.. "Are consumers with fewer friends more likely to take financial risks?." ScienceDaily. ScienceDaily, 15 January 2013. <www.sciencedaily.com/releases/2013/01/130115143820.htm>.
Journal of Consumer Research, Inc.. (2013, January 15). Are consumers with fewer friends more likely to take financial risks?. ScienceDaily. Retrieved December 21, 2014 from www.sciencedaily.com/releases/2013/01/130115143820.htm
Journal of Consumer Research, Inc.. "Are consumers with fewer friends more likely to take financial risks?." ScienceDaily. www.sciencedaily.com/releases/2013/01/130115143820.htm (accessed December 21, 2014).

Share This


More From ScienceDaily



More Mind & Brain News

Sunday, December 21, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Researchers Test Colombian Village With High Alzheimer's Rates

Researchers Test Colombian Village With High Alzheimer's Rates

AFP (Dec. 19, 2014) In Yarumal, a village in N. Colombia, Alzheimer's has ravaged a disproportionately large number of families. A genetic "curse" that may pave the way for research on how to treat the disease that claims a new victim every four seconds. Duration: 02:42 Video provided by AFP
Powered by NewsLook.com
Double-Amputee Becomes First To Move Two Prosthetic Arms With His Mind

Double-Amputee Becomes First To Move Two Prosthetic Arms With His Mind

Buzz60 (Dec. 19, 2014) A double-amputee makes history by becoming the first person to wear and operate two prosthetic arms using only his mind. Jen Markham has the story. Video provided by Buzz60
Powered by NewsLook.com
Prenatal Exposure To Pollution Might Increase Autism Risk

Prenatal Exposure To Pollution Might Increase Autism Risk

Newsy (Dec. 18, 2014) Harvard researchers found children whose mothers were exposed to high pollution levels in the third trimester were twice as likely to develop autism. Video provided by Newsy
Powered by NewsLook.com
Yoga Could Be As Beneficial For The Heart As Walking, Biking

Yoga Could Be As Beneficial For The Heart As Walking, Biking

Newsy (Dec. 17, 2014) Yoga can help your weight, blood pressure, cholesterol and heart just as much as biking and walking does, a new study suggests. Video provided by Newsy
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