Lecture #10- Applying motivation science to wealth Flashcards
What factors impact purchasing behaviors?
3pts
- Financial temptations
- Motivational reasons
- Impulse shopping
What are 2 environmental factors that boost impulse purchases ?
2pts
- Ambient music
- Scent marketing
- The more choices we have, the more likely we have the tendency to make poor decisions after a session of prior decision making.
- May occur when there are too many options and can’t decide, leading to inaction.
- Decision fatigue
- Decision paralysis
What internal factors impact spending impulses?
2pts
- Mood
- Social rejection
- CBD appears to be a desire to improve one’s BLANK, not a desire to BLANK.
- CBD patients lack BLANK understanding and have low tolerance for BLANK moods.
- Linked with BLANK (and drug use and eating disorders).
Fill in the blanks and what is CBD?
- Compulsive buying disorder (CBD)
- mood, shop
- emotional, negative
- impulsivity
Why are people irrational when it comes to money?
2pts
- Unconscious thought–> arbitrary coherence and anchoring on an arbitrary number
- Loss aversion
When things are framed as gains, we are BLANK.
When things are framed as losses, we are more BLANK
Risk seeking vs risk aversive, which is which?
- Risk aversive
- Risk seeking
- When you’ve already spent a lot of time, money, or effort on a goal, it is extra hard to let go of that goal.
- This leads people to hold onto bad stocks, invest in failed ventures, or even stay at a gambling table longer than they ought to
What concept is this?
Give an example.
- Sunk cost fallacy
Ex- A bad movie: You buy a ticket to a movie that turns out to be terrible halfway through. Instead of leaving, you stay to “get your money’s worth,” even though you’re not enjoying it.
What is the endowment effect?
Give an example.
2pts
- When people perceive something as theirs, they value it more than when they perceive something as belonging to someone else
I’d pay $3 for that mug vs. I wouldn’t sell it for less than $7
People promised a large reward had greater activity in the brain areas associated with motivation (ventral midbrain), causing them to choke under pressure.
What does this mean for money as a motivator?
Money can be too motivating in the moment
People high in BLANK tend to be less satisfied with their lives, have poorer quality relationships, and possess poorer mental health.
Materialism
What does the Gilbert’s principle of experience-stretching state?
States that the more you experience something pleasurable to less you enjoy it
Experience-stretching is far more likely with BLANK items than with BLANK purchases
Material, experiential
We will overestimate how happy pleasant experiences will be, but we also overestimate how unhappy unpleasant experiences will be.
Affective forecasting
