A University of Missouri researcher says people who overuse credit have very different beliefs about products than people who spend within their means. Following a new study, Marsha Richins, Myron Watkins Distinguished Professor of Marketing in the Trulaske College of Business, says many people buy products thinking that the items will make them happier and transform their lives.
"There is nothing wrong with wanting to buy products," Richins said. "It becomes a problem when people expect unreasonable degrees of change in their lives from their purchases. Some people tend to ascribe almost magical properties to goods — that buying things will make them happier, cause them to have more fun, improve their relationships — in short, transform their lives. These beliefs are fallacious for the most part, but nonetheless can be powerful motivators for people to spend."
Richins identified four types of changes that materialistic people expect when making purchases. Previous research has shown that often these expectations are not fulfilled. The four types of transformations expected are:
Transformation of the self is the belief that a purchase will change who you are and how people perceive you. This is commonly held by young people and people in new roles. For example, a woman interviewed for the study wanted to have cosmetic dental surgery because she thought it would improve her appearance and self-confidence.
Transformation of relationships is the expectation that a purchase will give someone more or better relationships with others. For example, a woman interviewed for the study wanted to buy a new home because she thought it would enable her to entertain more often and make more friends.
Hedonic transformation implies that a purchase will make life more fun. For example, a man in the study wanted a mountain bike because he thought it would give him more incentive to get out and go on "an adventure."
Efficacy transformation is the expectation that purchases will make people more effective in their lives. For example, some study participants wanted to buy a vehicle because they thought it would make them more independent and self-reliant.
People who have strong and unrealistic transformational beliefs are more likely than others to overuse credit and take on excessive debt. According to Richins, this finding highlights a limitation of financial literacy and credit counseling programs. She recommends that financial literacy and credit counseling programs be revised to help people better understand their motivations for purchasing goods and to help them recognize that products are not a quick fix for improving their lives.
"Many financial literacy programs seek to prevent people from getting into financial problems by presenting the facts about interests rate and loans," Richins said. "However, few programs seek to directly influence behavior or focus on why people purchase things they cannot afford and go into debt."
Richins conducted research through in-depth interviews and a national survey with respondents varying across income levels and demographic measures. The study, "Materialism, Transformation Expectations, and Spending: Implications for Credit Use," will be published in the fall by the Journal of Public Policy and Marketing, but it is available online at www.marketingpower.com/AboutAMA/Pages/AMA%20Pub lications/AMA%20Journals/Journal%20of%20Public%20Policy%20Marketing/JPPMForthcoming.aspx
Christian Basi | EurekAlert!
Europe's microtechnology industry is attuned to growth
10.03.2017 | IVAM Fachverband für Mikrotechnik
Preferential trade agreements enhance global trade at the expense of its resilience
17.02.2017 | International Institute for Applied Systems Analysis (IIASA)
The Institute of Semiconductor Technology and the Institute of Physical and Theoretical Chemistry, both members of the Laboratory for Emerging Nanometrology (LENA), at Technische Universität Braunschweig are partners in a new European research project entitled ChipScope, which aims to develop a completely new and extremely small optical microscope capable of observing the interior of living cells in real time. A consortium of 7 partners from 5 countries will tackle this issue with very ambitious objectives during a four-year research program.
To demonstrate the usefulness of this new scientific tool, at the end of the project the developed chip-sized microscope will be used to observe in real-time...
Astronomers from Bonn and Tautenburg in Thuringia (Germany) used the 100-m radio telescope at Effelsberg to observe several galaxy clusters. At the edges of these large accumulations of dark matter, stellar systems (galaxies), hot gas, and charged particles, they found magnetic fields that are exceptionally ordered over distances of many million light years. This makes them the most extended magnetic fields in the universe known so far.
The results will be published on March 22 in the journal „Astronomy & Astrophysics“.
Galaxy clusters are the largest gravitationally bound structures in the universe. With a typical extent of about 10 million light years, i.e. 100 times the...
Researchers at the Goethe University Frankfurt, together with partners from the University of Tübingen in Germany and Queen Mary University as well as Francis Crick Institute from London (UK) have developed a novel technology to decipher the secret ubiquitin code.
Ubiquitin is a small protein that can be linked to other cellular proteins, thereby controlling and modulating their functions. The attachment occurs in many...
In the eternal search for next generation high-efficiency solar cells and LEDs, scientists at Los Alamos National Laboratory and their partners are creating...
Silicon nanosheets are thin, two-dimensional layers with exceptional optoelectronic properties very similar to those of graphene. Albeit, the nanosheets are less stable. Now researchers at the Technical University of Munich (TUM) have, for the first time ever, produced a composite material combining silicon nanosheets and a polymer that is both UV-resistant and easy to process. This brings the scientists a significant step closer to industrial applications like flexible displays and photosensors.
Silicon nanosheets are thin, two-dimensional layers with exceptional optoelectronic properties very similar to those of graphene. Albeit, the nanosheets are...
20.03.2017 | Event News
14.03.2017 | Event News
07.03.2017 | Event News
28.03.2017 | Life Sciences
28.03.2017 | Information Technology
28.03.2017 | Physics and Astronomy