Research

May 5, 2011

We like to think we’re rational about money. We go for the credit card or mortgage that has the lowest interest rate.

Think again. Our moods, emotions, and other reactions to aesthetic cues play a decisive role in financial decisions, according to innovative research by Suzanne Shu at UCLA and Claudia Townsend at the University of Miami.

“Everybody expects that it [aesthetics] is not going to influence them, so it’s extra surprising when it does,” Shu said in a recent interview.

The marketing professors’ results carry a message for anyone interested in financial literacy. Their research subjects thought twice about their decisions after receiving very subtle references to aesthetics. In other words, when people are alerted to their unconscious reactions to how something looks, they adjust their thinking to guard against being overly influenced by the aesthetics. …Learn More

On the Web

May 5, 2011

A new game on the Web – Spent – is a compelling way to experience the impossible choices the poor must make every day about money.

Spent was created by Urban Ministries of Durham in North Carolina, which operates a food pantry, clothing closet, and homeless shelter; and a local advertising firm, McKinney. The game gets its point across so well because McKinney interviewed the ministry’s clients and translated their real-world predicaments.

The challenge: players must get to the end of the month without depleting their small paychecks on routine bills and unexpected expenses. So, your child is invited to a birthday party, but you cannot afford the $5 gift. Do you send your child to the party without a gift, make her stay home, or buy the gift anyway – and risk running out of money? …Learn More