Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:

 

Time isn't money: Study finds that we spend the resources differently

19.03.2008
Economists usually treat time like money – as another scarce resource that people spend to achieve certain ends.

Money is used to pay for things like furniture and plane tickets; time is spent assembling the do-it-yourself bookshelf or searching for cheap flights on the Internet. But despite the old adage that time is money, the two are far from psychologically equivalent, reveals a study from the April issue of the Journal of Consumer Research – particularly when it comes to consumer spending decisions.

In a series of experiments, Ritesh Saini (George Mason University) and Ashwani Monga (University of Texas, San Antonio) demonstrate that a qualitatively different form of decision making gains prominence when consumers work with time instead of money. Specifically, consumers thinking about expenditure of time are more likely to rely on heuristics: intuitive, quick judgments based more on prior experience than on analysis of the information presented.

For example, one experiment had participants consider the purchase of a used car. They were told that a search on a used-car website had yielded 80 cars meeting their criteria but that viewing each accident record would take either $1 or 5 minutes of time. They were then asked how many records they would like to view, with a catch: the researchers used classic experimental “anchoring” techniques to manipulate the answers.

Participants were asked whether they would view “up to 2” or “up to 40” records, before indicating the specific number of records they would view. The use of an anchor, for those thinking in terms of time expenditure, turned out to have a significant impact.

When the anchor value was high in the time condition, consumers chose to view an average of 23.7 accident reports, versus 9.1 when the anchor value was low. The number of records consumers in the money condition chose to view was statistically the same, irrespective of whether the anchor value was high or low.

“People face difficulties in accounting for time because they do not routinely transact in time as they do in money,” explain the researchers. “Although people in some professions (e.g., lawyers) do keenly monitor their time expenditures, most other people are not trained to do so.”

Furthermore, by measuring response times—the time taken by participants to arrive at decisions—the researchers find supporting evidence for the idea that quick and easy heuristics are used more in time than in money.

“These results suggest that businesses need to be aware that decisions regarding products and services might be made differently if consumers spend their time rather than money,” Saini and Monga explain. “Unlike money which is unambiguous—a dollar is a dollar in all circumstances—the value of time changes from one situation to another.”

Ritesh Saini and Ashwani Monga, “How I Decide Depends on What I Spend: Use of Heuristics Is Greater for Time than for Money.” Journal of Consumer Research: April 2008.

Suzanne Wu | EurekAlert!
Further information:
http://www.uchicago.edu

More articles from Business and Finance:

nachricht Preferential trade agreements enhance global trade at the expense of its resilience
17.02.2017 | International Institute for Applied Systems Analysis (IIASA)

nachricht How Strong Brands Translate into Money
15.11.2016 | Kühne Logistics University - Wissenschaftliche Hochschule für Logistik und Unternehmensführung

All articles from Business and Finance >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: Researchers Imitate Molecular Crowding in Cells

Enzymes behave differently in a test tube compared with the molecular scrum of a living cell. Chemists from the University of Basel have now been able to simulate these confined natural conditions in artificial vesicles for the first time. As reported in the academic journal Small, the results are offering better insight into the development of nanoreactors and artificial organelles.

Enzymes behave differently in a test tube compared with the molecular scrum of a living cell. Chemists from the University of Basel have now been able to...

Im Focus: Safe glide at total engine failure with ELA-inside

On January 15, 2009, Chesley B. Sullenberger was celebrated world-wide: after the two engines had failed due to bird strike, he and his flight crew succeeded after a glide flight with an Airbus A320 in ditching on the Hudson River. All 155 people on board were saved.

On January 15, 2009, Chesley B. Sullenberger was celebrated world-wide: after the two engines had failed due to bird strike, he and his flight crew succeeded...

Im Focus: Breakthrough with a chain of gold atoms

In the field of nanoscience, an international team of physicists with participants from Konstanz has achieved a breakthrough in understanding heat transport

In the field of nanoscience, an international team of physicists with participants from Konstanz has achieved a breakthrough in understanding heat transport

Im Focus: DNA repair: a new letter in the cell alphabet

Results reveal how discoveries may be hidden in scientific “blind spots”

Cells need to repair damaged DNA in our genes to prevent the development of cancer and other diseases. Our cells therefore activate and send “repair-proteins”...

Im Focus: Dresdner scientists print tomorrow’s world

The Fraunhofer IWS Dresden and Technische Universität Dresden inaugurated their jointly operated Center for Additive Manufacturing Dresden (AMCD) with a festive ceremony on February 7, 2017. Scientists from various disciplines perform research on materials, additive manufacturing processes and innovative technologies, which build up components in a layer by layer process. This technology opens up new horizons for component design and combinations of functions. For example during fabrication, electrical conductors and sensors are already able to be additively manufactured into components. They provide information about stress conditions of a product during operation.

The 3D-printing technology, or additive manufacturing as it is often called, has long made the step out of scientific research laboratories into industrial...

All Focus news of the innovation-report >>>

Anzeige

Anzeige

Event News

Booth and panel discussion – The Lindau Nobel Laureate Meetings at the AAAS 2017 Annual Meeting

13.02.2017 | Event News

Complex Loading versus Hidden Reserves

10.02.2017 | Event News

International Conference on Crystal Growth in Freiburg

09.02.2017 | Event News

 
Latest News

A better way to measure the stiffness of cancer cells

01.03.2017 | Health and Medicine

Exploring the mysteries of supercooled water

01.03.2017 | Physics and Astronomy

Research team of the HAW Hamburg reanimated ancestral microbe from the depth of the earth

01.03.2017 | Life Sciences

VideoLinks
B2B-VideoLinks
More VideoLinks >>>