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Does dirty money influence product valuations?
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Research Report
Does dirty money influence product valuations?☆ Chelsea Galoni a,⁎, Theodore J. Noseworthy b a
b
Kellogg School of Management at Northwestern University, 2001 Sheridan Rd., Evanston, IL 60208, United States Canada Research Chair of Entrepreneurial Innovation and the Public Good in the Schulich School of Business at York University, 99 Ian Macdonald Blvd, Toronto, ON M3J 1P3, Canada Received 6 December 2013; received in revised form 6 November 2014; accepted 7 November 2014
Abstract Despite recent interest in examining the impact of dirty money on consumption-related behavior, researchers have yet to look at the influence of dirty money on the consumable itself. Evidence from two studies suggest that the documented effects of dirty money on spending may have more to do with dirty money contaminating the purchase, as opposed to the current belief that consumers merely want to rid themselves of disgusting things. The authors find that people indeed spend more with dirty money, but only when the bills lower product valuations. This does not occur when people purchase products with inherent properties that cannot be contaminated; in fact, dirty money can increase valuations and preference for these products. The results suggest that the physical appearance of money plays a much larger, more nuanced role in consumption than previously thought, and this effect may not be entirely positive for the consumer. © 2014 Society for Consumer Psychology. Published by Elsevier Inc. All rights reserved. Keywords: Disgust; Contamination; Dirty money; Product valuations; Spending
Introduction There has been growing interest in exploring the impact of dirty money (in the literal sense) on consumption-related behavior (Di Muro & Noseworthy, 2013; Yang et al., 2013). In a recent example, Di Muro and Noseworthy (2013) used crumpled new bills to tap normative beliefs that money is dirty. The authors found that disgust derived from worn bills encourages consumers to rid themselves of the notes, thus increasing spending. This is consistent with the finding that disgust can trigger goals of expelling (Lerner, Small, & Lowenstein, 2004). This work generated significant media attention under the premise that dirty bills may fuel the economy. Indeed, there may be a quantifiable benefit to leaving ☆ The authors would like to thank the NOESIS: Design, Innovation, and Consumption Laboratory. This research was funded by the Social Sciences and Humanities Research Council of Canada (SSHRC insights grant #435-2013-0235). ⁎ Corresponding author. E-mail addresses: [email protected] (C. Galoni), [email protected] (T.J. Noseworthy).
worn bills in circulation; however, researchers have yet to account for what this means for the products purchased with dirty money. The law of contagion posits that when a source comes in direct or indirect contact with a target, the source can transfer some, if not all, of its properties to the target (Frazer, 1959 [1890]; Rozin & Nemeroff, 1990). The target then retains the properties received from the source even after the contact has been broken (Rozin & Nemeroff, 1990). This transference can happen for both positive and negative properties, and contact does not have to be physical for transference to occur (Nemeroff & Rozin, 1994; Rozin & Nemeroff, 1990). Evidence suggests that both consumers and products can be contagious. For example, Argo, Dahl, and Morales (2006, 2008) found that ratings for a particular product can be raised or lessened depending on the qualities of the people who came in previous contact with that product. Morales and Fitzsimons (2007) found that ratings for a particular product can be lessened if the product comes into physical contact with a normatively disgusting product (i.e., feminine napkins). This research offers evidence for how the contagious antecedents of a purchase can impact ratings for that purchase. Given that money is a required
http://dx.doi.org/10.1016/j.jcps.2014.11.002 1057-7408/© 2014 Society for Consumer Psychology. Published by Elsevier Inc. All rights reserved. Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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and constant antecedent for purchases, we posit that money itself can be contagious; that is, the perceived properties of money can transfer and impact beliefs about the products it purchases. This idea is not without support. What much of the research on negative contagion has in common is the concept of disgust. Disgust is a visceral emotion believed to have evolved specifically to serve the function of avoidance (Rozin, Haidt, & McCauley, 1993). Researchers have shown that unresolved disgust can lower selling and buying prices, and influence one's willingness to stick with the status quo (Han, Lerner, & Zeckhauser, 2012; Lerner et al., 2004). One very prominent source of disgust is the fear of pathogen transference (Tybur, Lieberman, & Griskevicius, 2009). Pathogen disgust can be elicited through visual cues that are normatively linked to pathogen presence, even when such cues are devoid of infectious agents (Rozin, Millman, & Nemeroff, 1986). Critically, pathogen disgust will often lead people to reject or devalue the seemingly contaminated object (Rozin & Fallon, 1987; Rozin & Nemeroff, 1990; Rozin et al., 1986; Rozin et al., 1989; Rozin et al., 1993). This is important because money itself is laden with pathogens. Recent research —aptly named the “Dirty Money Project”—conducted at New York University revealed that an average $1 bill (USD) houses over 3000 types of bacteria (Hotz, 2014). This statistic reflects a dominant belief in society that money is quite literally dirty. Thus, we propose that touching something that is normatively disgusting (e.g., dirty money) may transfer and affect the valuations of objects that are subsequently touched (e.g., a product). This idea is not as farfetched as it may seem. At one time or another, we have all been asked to wash our hands after touching something that is normatively filthy for fear of pathogen transfer. The following studies were designed to test this prediction. Overview of the present research We conducted two studies to investigate how dirty money can influence product valuations and consequently alter choice behavior and spending. In Study 1, we demonstrate that consumers who are disgusted by dirty bills put less value on their purchases and this leads them to seemingly compensate by buying more items. In Study 2, we explore whether the results of Study 1 are due to the threat of contamination of the products or due to goals of expelling the disgusting bills. The results support the former. Specifically, despite that consumers were generally disgusted by dirty bills, Study 1 replicated only when consumers were permitted to touch the products. Moreover, by unconstraining the choice of product category, we find that consumers who are disgusted by dirty bills become more likely to shop for cleaning products. Critically, if permitted to touch the cleaning products, product valuations increase and no compensatory spending takes place. Study 1 In Study 1, we establish the phenomenon that dirty money can drop product valuations and this, in turn, can lead to
increased consumption. Specifically, we provide individuals with either worn or crisp bills and then permit them to shop in a mock retail setting. We then record purchase quantity and total spending, as well as capture post purchase valuations of the products. Method Participants (N = 72, 67% female, Mage = 41.71) were recruited through advertisements and public posters, and were tested one at a time in a mock retail setting. Upon entering the setting, each participant was presented with a box consisting of several sealed white envelopes. Participants were informed that each envelope contained anywhere from $10 to $30. They were instructed to select one envelope, open it, take out the money, and confirm the amount. This ensured that participants touched the money before engaging in the retail transaction. Despite the guise, all envelopes contained a $20 bill. The range of the guise ensured that the $20 gain was not coded as a relative win or loss within the realm of chance. The only thing that varied between participants was whether the bill in the envelope was worn or crisp. Untarnished notes were requisitioned from a local bank. The worn condition was manipulated by crumpling and discoloring the bills whereas the crisp bills were left unaltered. Upon taking the bill in hand, participants were directed to the store aisle. The products on the shelves were all food-related. What varied was their nutritional value under the guise that we were exploring if people select healthier versus less healthy snacks when awarded a cash windfall (see appendix). The products ranged from $1.00 to $3.50, and were organized such that an adjacent healthier option of equal price was always available. Participants were instructed to purchase at least one item and were instructed that all products purchased as well as the remaining change would be theirs to keep following the study. Upon completing the selection, the cashier generated a receipt that recorded the experimental condition (using a non-descript identifier), the number and name of the products, and the entire basket amount. The cashier then administered the appropriate change along with a copy of the receipt. Participants were then directed to a cubicle to fill out a questionnaire. In step with Di Muro and Noseworthy (2013), the manipulation check asked participants to judge the degree to which the bill they used was worn-out (anchored 1 = not at all worn, 7 = very worn). Participants were then instructed to focus specifically on how the bill made them feel, and respond to four 5-point items (anchored 1 = not at all, 5 = extremely) that captured perceived disgust (disgusted; unclean; dirty; revolted; Morales & Fitzsimons, 2007). Unlike Di Muro and Noseworthy who assessed the perceived value of the bills, participants were asked to rate the value of each of the products they purchased on eleven 7-point items (anchored 1 = strongly disagree, 7 = strongly agree). Five of the items tapped participants' perceptions of product value (has consistent quality; is well made; would not last long; something I would enjoy; something that would give me pleasure) and six items captured participants' perceptions of usage value (something that I would want to use; something that I would feel relaxed
Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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about using; would help me to feel accepted; would improve the way I am perceived; would make a good impression on others; would give its owner social approval; adapted from Di Muro & Noseworthy, 2013). Participants were then asked to record their general affective state using the 20-item Positive and Negative Affect Schedule (PANAS; Watson, Clark, & Tellegen, 1988). The questionnaire concluded with basic demographic questions. Results and discussion Manipulation and confound check A manipulation check confirmed that consumers rated the altered bills as more worn-out (M = 6.36, SD = 1.15) than the unaltered bills (M = 2.56, SD = 1.79), t(70) = 10.71, p b .001, d = 2.53. Importantly, despite the spending prioritization guise, this effect did not influence product selection. Specifically, a selection index was created within subjects by subtracting the number of healthier choices from the number of less healthy choices divided by the total basket of goods. The index was such that a negative number implied healthier selections, whereas a positive number implied less healthy selections. The results revealed that the physical state of the bills did not influence choice (MWorn = − .14 vs. MCrisp = − .24, ns). Furthermore, the physical state of the bills did not influence participants' affective state, be it positive (MWorn = 3.08 vs. MCrisp = 3.07, ns) or negative (MWorn = 1.69 vs. MCrisp = 1.48, ns). This suggests that any observed change in valuation across the worn and crisp conditions could not be attributed to participants' affective state or their selection criterion. Hypothesis testing An analysis of state-driven disgust (α = .71) revealed that participants were more disgusted by the worn bills (M = 1.45, SD = .63) than by the crisp bills (M = 1.12, SD = .36), t(70) = 2.85, p b .01, d = .67. Consistent with the results of Di Muro and Noseworthy (2013), these inferences translated into differences in spending. Specifically, participants spent more when they purchased with worn bills (M = $5.85, SD = $3.28) than when they purchased with crisp bills (M = $4.25, SD = $2.39), t(70) = 2.36, p b .05, d = .56. Critically, close inspection revealed that participants did not buy more expensive items (MWorn = $2.14 vs. MCrisp = $2.04, ns), but instead they purchased more items (MWorn = 2.89, SD = 1.67 vs. MCrisp = 2.14, SD = 1.18), t(70) = 2.20, p b .05, d = .51. The core prediction was that this may have something to do with the value consumers see in the products purchased with worn bills. In support of our core prediction, there was a significant effect of the physical state of money on perceived product value (α = .71), such that products purchased with worn bills were seen as less valuable (M = 5.39, SD = .81) than products purchased with crisp bills (M = 5.80, SD = .89), t(70) = − 2.01, p b .05, d = .47. To test whether disgust led to the drop in valuation, which in turn increased spending, a serial mediation analysis was conducted whereby the indirect effect and the standard error of the indirect effect were estimated using a bias-corrected bootstrap with 5000 draws (Hayes, 2012;
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MacKinnon, Lockwood, & Williams, 2004, Model 6). Despite the absolute means for disgust being relatively low, the results yielded a significant indirect effect of the physical state of money on spending through disgust and then product valuation, 95% CI [− .642, − .002]. Furthermore, the direct effect of the physical state of money on spending was no longer significant, path c′: B = − .59, SE = .62, ns. Importantly, participants in the worn banknote condition put just as much value on owning the items as did participants in the crisp banknote condition (α = .82; MWorn = 4.24 vs. MCrisp = 4.17, ns). Study 1 raises two important questions: First, if dirty money can contaminate a purchase and subsequently drop product valuations, is it possible that dirty money may lead someone to put more value on, and even become more likely to select, products that combat pathogen transfer? This is critical because if dirty money can both raise and lower product valuations, one would be hard pressed to argue that the effects are solely due to people wanting to rid themselves of disgusting things (Di Muro & Noseworthy, 2013; Lerner et al., 2004). Second, if the valuation effects are indeed the result of pathogen disgust, there is the question of whether we are tapping physical or symbolic contamination. Nemeroff and Rozin (1994) first introduced the idea of non-physical contagion. The authors showed that contamination can manifest as the symbolic meaning implied by interacting with an object (e.g., If one wears Hitler's sweater, one is implying acceptance of him), or through associations that the object has with others (e.g., Inherited money can be contaminated with memories of the deceased; Levav & McGraw, 2009; Tykocinski & Pittman, 2013). However, several findings suggest that for product valuations to drop in a regular (non-contaminated) object, there must be a real threat of pathogen transfer and thus contact must be physical (Argo et al., 2006; Morales & Fitzsimons, 2007). In no instance in study 1 did the money come into physical contact with the products, but it did come in contact with the consumer. If we are to assume a physical path to contamination, then it would have to flow through the consumer. Conversely, a symbolic path to contamination would argue that merely being disgusted would generate the observed effects. Study 2 was designed to address these questions. Study 2 Study 2 examines whether the influence of dirty money on spending is the result of the bills contaminating the purchases or merely due to disgust priming goals to expel. Specifically, we examine (1) if disgust alone can predict the results or whether individuals need to touch the products for valuations to drop, and (2) if the influence of dirty money on product valuations depends on what the individual buys, regardless of his or her state of disgust. Method Participants (N = 202, 57.9% female, Mage = 26.27) were recruited through newspapers and public posters, and were randomly assigned to one of four conditions in a 2 (physical appearance: worn vs. control) × 2 (instructions: touch vs. no
Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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touch) between-subjects design. The procedures and dependent measures were consistent with study 1, with the following alterations: First, to test whether dirty money can alter choice behavior, the store was redesigned to have office supplies along one aisle and cleaning supplies along the other (see appendix). Following the bill manipulation, participants were instructed that they may peruse both isles, but may only choose one aisle to do their purchasing. Consistent with study 1, participants were required to purchase at least one item in that aisle, and they were informed that all purchases as well as the remaining change would be theirs to keep. Furthermore, given that our focus was on consumer inferences about worn bills and not the value that consumers place on new bills, the crisp bills were replaced with standard (control) bills dispensed from a local bank machine. Care was taken to ensure that the bills were the same stylized printing and similar date of issuing across both conditions. The manipulation of the worn bills followed the exact same procedure described in study 1. Second, to explore whether the observed effects from study 1 resulted from the physical path or the symbolic path to contamination, participants were either instructed to collect their products themselves and bring them to the cashier (touch condition; replicating study 1) or to examine the products closely without touching them and then inform the cashier of their selection (no touch condition). In both conditions, participants were told that the selected products would be available at the front of the room when the task was complete. Importantly, to ensure information was symmetrical across the two touch conditions, participants in the touch condition were not permitted to handle the products and peruse the ingredient lists, but only to pick up the products and bring them to the cashier. Finally, the questionnaire remained identical with study 1 with the addition of a measure to ensure that the bills were not altering participants' affective judgments of the product (anchored: 1 = not at all; 7 = extremely; “Likeable,” “Appealing,” “Favorable,” “Enjoyable”). In addition, we included an open-ended question asking participants to justify their product selection, and we rotated the disgust questions to follow the valuation questions in an effort to ensure that there were no carry-over effects from prompting disgust on the valuation results. Results and discussion Manipulation check and confound check Consistent with study 1, consumers rated the altered bills as more worn-out (M = 6.06; SD = 1.56) than the unaltered bills (M = 3.17; SD = 1.81), F(1,198) = 147.09, p b .001, η2 = .42. Importantly, the main effect of touch on perceptions of wornness was not significant, F(1,198) = .04, ns. Neither was the physical appearance × touch interaction, F(1,198) = 1.78, ns. Furthermore, the manipulation of the bills did not influence participants' affective state (positive or negative, Fs b 2), nor did it influence participants' affective response to the products (α = .87; Fs b 1). As in study 1, participants were generally more positive (M = 3.21; SD = .73) than negative (M = 1.52;
SD = .57), F(1,198) = 723.76, p b .001, η2p = .75. Thus, once again, the manipulation of the bills worked as intended. Disgust A two-way ANOVA revealed a main effect of the physical appearance of the bills on state disgust (α = .72), such that participants were more disgusted by the worn bills (M = 1.35; SD = .59) than by the standard bills (M = 1.20; SD = .34), F(1,198) = 5.09, p b .05. η2 = .02. The physical appearance × touch interaction was not significant, F(1,198) = .03, ns. Thus, the influence of the physical appearance of money on state disgust did not vary by touch. This is important because if this were disgust initiating goals of expelling then participants should demonstrate equivalent effects regardless of whether they touched the bills. However, if this is more about a fear of pathogens contaminating the products, then choice selection and spending should vary by touch. Aisle selection and spending As it is inappropriate to model choice and quantity decisions separately when the quantity decision is not statistically independent of the choice decision (i.e., when there may be selectivity artifacts; Heckman, 1979; Jedidi, Mela, & Gupta, 1999; Krishnamurthi & Raj, 1988), we estimated a model that corrected for a possible selection bias using Lee's (1983) generalization of Heckman's (1979) two-stage-least-squares (2SLS) procedure. Selectivity artifacts are commonly encountered in experimental situations where only certain items survive to be observed at a later stage. In our case, because we were interested in whether the bills primed individuals to select a specific store aisle, we could not randomly assign the individuals to the store aisles. Thus, any assessment of spending within one specific aisle has to account for the fact that the initial aisle selection process limits which items offer up subsequent information. Overall, the estimates revealed no significant correlation among the residuals, implying the absence of a selection bias, ρ = .01, σ = 4.76, ns. Despite the above, the results of the model supported our core prediction. Specifically, those who were given worn bills and permitted to touch the products were more likely to choose the cleaning supplies aisle over the office supplies aisle, B = − .78, SE = .37, p b .05. However, as illustrated in Fig. 1, those who did select the office supplies aisle, and were permitted to touch the products after handling the worn bills, subsequently purchased more items, B = .91, SE = .43, p b .05, and thus spent more money, B = 4.37, SE = 1.81, p b .05. Critically, individuals did not spend more money when they selected the cleaning supplies aisle, and they did not spend more money in either aisle when touch was prohibited. This suggests that only when individuals were permitted to touch the products did the physical state of the bills alter choice behavior. Again, given that perusal of the packaging was prohibited, this effect cannot be attributed to greater search yielding refined preference. As in study 1, the observed increase in spending was expected to correspond with a decrease in product valuations. As illustrated in Fig. 2, an analysis of perceived product value
Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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Fig. 1. Total spending separated by aisle selection. (Standard errors included).
(α = .81) revealed that participants who were permitted to touch the products put less value on the office supplies in the worn bill condition (M = 4.93, SD = 1.12) than in the standard bill condition (M = 5.52, SD = .93), F(1,198) = 3.85, p b .05, η2 = .02. As expected, this effect did not manifest when touching the products was prohibited (MWorn = 5.31 vs. MStandard = 5.43), F(1,198) = .17, ns. Furthermore, in support of our valuation prediction, the results reversed for those who chose cleaning products. Specifically, participants who were permitted to touch the products put more value on the cleaning products in the worn bill condition (M = 5.73, SD = 1.21) than in the standard bill condition (M = 5.06, SD = 1.19), F(1,198) = 3.52, p = .062, η2 = .02. Again, this effect did not manifest when touching the products was prohibited (MWorn = 5.12 vs. MStandard = 5.15), F(1,198) = .01, ns. A follow-up check of participants' rationale for their choice selection, coded by two unaffiliated judges (r = .87), revealed no material difference in participants justification for their choice. The most common responses were, “I chose what I would choose if at a real store,” or “I prioritized exactly as I do normally.” Thus, the physical appearance of money not only alters product valuations, but also choice selection, and importantly, it does so in way that relates more to changes in the product's value than to a desire to rid oneself of dirty money. General discussion Given the recent economic recession, there has been considerable media attention around the need to decrease government
spending while increasing domestic spending. The results from recent work suggest that governments may be better served, both in terms of domestic spending and currency production costs, by leaving worn bills in circulation (Di Muro & Noseworthy, 2013). Indeed, the Federal Reserve may be better served, but the results of this study suggest the consumer may not be. Thus, with the recent interest in exploring the effects of currency on consumption behavior (e.g., Di Muro & Noseworthy, 2013; Xie, Yu, Zhou, Sedikides, & Vohs, in press; Yang et al., 2013), the results caution that researchers should not ignore the consumable itself. Evidence from two studies brings up the possibility that the observed influence of dirty money on spending could be the result of consumers offsetting lower product valuations by purchasing more items, not by consumers wanting to rid themselves of dirty bills. This suggests that the effects observed in prior work may have more to do with product utility than with goals of expelling. In support of this, we found that dirty money can actually raise valuations for, and shift preference towards, products that fend off contamination. Critically, when this occurs, spending does not increase, arguably because there is no diminished utility to be offset by volume. These results present the first account of negative contamination augmenting product valuations. The question going forward is why would someone buy more of something in which they see less value? Might these findings be related to consumer goals? Future research could explore if the devaluation of dirty bills prompts consumers to regain value, hence leading to a greater incidence of purchase. That is, if spending goals were violated by the reduced implicit
Fig. 2. Product valuations separated by aisle selection. (Standard errors included). Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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value of the bill, would someone then attempt to reaffirm these goals by spending more? This same concept of a reduction in implicit value could extend into other work. For example, Yang et al. (2013) found that farmers given dirty money would cheat customers by giving less than the 500 g of produce that the customer had paid for. Could it be that it was not so much that farmers were deliberately cheating, but that they gave what was perceived to be of equivalent utility to the dirty bills? This would be an interesting avenue to explore. Our findings are not without limitations and present many opportunities for future work. First, given that the purpose of study 2 was primarily to explore whether dirty money could prime choice behavior, it is important to reiterate that individuals were not randomly assigned to the store aisles. Not only did this pose some challenges and limitations from a statistical perspective, but it also raised the question of whether there is a motivational effect in the valuation results. It would be interesting to see if the same results would hold if we forced someone to purchase cleaning supplies. It would also be interesting to test which specific attributes are affected by disgust using a discrete choice methodology that compares across store aisles (e.g., Noseworthy, Wang, & Islam, 2012). One would expect that consumers would put more weight on attributes related to fighting pathogens when they are disgusted with dirty bills. Furthermore, although the results seemingly support the physical path to contamination, there is the possibility that having participants not touch the product influenced their valuations in different ways that extend beyond the type of contamination. This is important because researchers have linked touch to endowment (Peck & Shu, 2009), and have linked disgust to endowment (Lerner et al., 2004). Thus, could it be that the influence of dirty money on product valuations was suppressed in the no touch condition because participants lacked ownership? We were quite cognizant of this possibility and incorporated a follow-up check. Specifically, before participants were discharged from the lab, a confederate, who was unaware of the hypotheses, approached the participants and asked what they would be willing to accept for each product if we were to buy the products back to keep the shelves stocked. Consistent with research on the endowment effect, when participants in study 2 purchased with standard bills, average selling price (MSell = $3.88; SD = $1.91) exceeded the average buying price (MBuy = $3.42; SD = $1.35), F(1,198) = 6.93, p b .01, η2p = .03. Consistent with the findings of Lerner et al. (2004), endowment did not manifest when participants were disgusted by the worn bills (MSell = $3.43 vs. MBuy = $3.60), F(1,198) = 1.06, ns. Critically, this pattern of effects did not vary by touch (Fs b 2). Thus, participants were endowed whether they touched the product or not, and more importantly, the influence of disgust on endowment did not vary by touch. Therefore, it seems that endowment could not account for the observed effects. That said, future research could isolate whether this was indeed physical transference. Given that the physical path would have to assume transference through the consumer, the finding that touching normatively disgusting
objects and then touching a product can contaminate the product could have some very interesting implications for future work. Lastly, it is also possible that the observed effects may have had something to do with participants liking the worn bills less. However, across both studies there were no differences in the value participants placed on owning the products purchased or in their affective states. Furthermore, in study 2, participants' affective response to the products did not vary by the bill condition. Thus, if they did like the bills less, this did not transfer to the products they purchased. This does, however, raise the question of how aware participants were of their selection. We found no explicit evidence in participants' thoughts to suggest that they were deliberately looking to fend off contamination. It seemed that the effect was entirely driven by the value they placed on the object. Indeed, the estimated utility derived from worn currency could go a long way in explaining current theoretical accounts. Certainly more research is needed in this area. Appendix A. Supplementary data Supplementary data to this article can be found online at http://dx.doi.org/10.1016/j.jcps.2014.11.002. References Argo, J. J., Dahl, D. W., & Morales, A. C. (2006). Consumer contamination: How consumers react to products touched by others. Journal of Marketing, 70(April), 81–94. Di Muro, F., & Noseworthy, T. J. (2013). Money isn't everything but it helps if it doesn't look used: How the physical appearance of money influences spending. Journal of Consumer Research, 39 (April), 1330–1342. Frazer, J. G. (1959 [1890]]). The Golden Bough: A study in magic and religion. In T. H. Gaster (Ed.), New York: McMillan. Han, S., Lerner, J. S., & Zeckhauser, R. (2012). The disgust-promotes-disposal effect. Journal of Risk and Uncertainty, 44(2), 101–113. Hayes, A. F. (2012). PROCESS: A versatile computational tool for observed variable mediation, moderation, and conditional process modeling. White paper (http://www.afhayes.com/public/process2012.pdf). Heckman, J. J. (1979). Sample selection bias as a specification error. Econometrica: Journal of the Econometric Society, 153–161. Hotz, R. L. (2014). Why you shouldn't put your money where your mouth is. The Wall Street Journal (Retrieved from http://biology.as.nyu.edu/page/news). Jedidi, K., Mela, C. F., & Gupta, S. (1999). Managing advertising and promotion for long-run profitability. Marketing Science, 18(1), 1–22. Krishnamurthi, L., & Raj, S. P. (1988). A model of brand choice and purchase quantity price sensitivities. Marketing Science, 7(1), 1–20. Lee, L. F. (1983). Generalized econometric models with selectivity. Econometrica: Journal of the Econometric Society, 507–512. Lerner, J. S., Small, D. A., & Lowenstein, G. (2004). Heart strings and purse strings: Carryover effects of emotions on economic decisions. Psychological Science, 15 (May), 337–341. Levav, J., & McGraw, A. P. (2009). Emotional accounting: How feelings about money influence consumer choice. Journal of Marketing Research, 46(1), 66–80. MacKinnon, D. P., Lockwood, C. M., & Williams, J. (2004). Confidence limits for the indirect effect: Distribution of the product and resampling methods. Multivariate Behavioral Research, 39 (January), 99–123. Morales, A. C., & Fitzsimons, G. J. (2007). Product contagion: Changing consumer evaluations through physical contact with ‘disgusting’ products. Journal of Marketing Research, 44 (May), 272–283.
Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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Rozin, P., Nemeroff, C., Wane, M., & Sherrod, A. (1989). Operation of the sympathetic magical law of contagion in interpersonal attitudes among Americans. Bulletin of the Psychonomic Society, 27(4), 367–370. Tybur, J. M., Lieberman, D., & Griskevicius, V. (2009). Microbes, mating, and morality: Individual differences in three functional domains of disgust. Journal of Personality and Social Psychology, 97 (July), 103–122. Tykocinski, O. E., & Pittman, T. S. (2013). Money imbued with essence: How we preserve, invest, and spend inherited money. Basic and Applied Social Psychology, 35(6), 506–514. Watson, D., Clark, L. A., & Tellegen, A. (1988). Development and validation of brief measures of positive and negative affect: The PANAS scales. Journal of Personality and Social Psychology, 54 (June), 1063–1070. Xie, W., Yu, B., Zhou, X., Sedikides, C., & Vohs, K. D. (2014s). Money, moral transgressions, and blame. Journal of Consumer Psychology. http://dx.doi. org/10.1016/j.jcps2013.12.002 (in press). Yang, Q., Wu, X., Zhou, X., Mean, N. L., Vohs, K. D., & Baumeister, R. (2013). Diverging effects of clean versus dirty money on attitudes, values, and interpersonal behavior. Journal of Personality and Social Psychology, 104 (March), 473–489.
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ScienceDirect Journal of Consumer Psychology xx, x (2014) xxx – xxx
Research Report
Does dirty money influence product valuations?☆ Chelsea Galoni a,⁎, Theodore J. Noseworthy b a
b
Kellogg School of Management at Northwestern University, 2001 Sheridan Rd., Evanston, IL 60208, United States Canada Research Chair of Entrepreneurial Innovation and the Public Good in the Schulich School of Business at York University, 99 Ian Macdonald Blvd, Toronto, ON M3J 1P3, Canada Received 6 December 2013; received in revised form 6 November 2014; accepted 7 November 2014
Abstract Despite recent interest in examining the impact of dirty money on consumption-related behavior, researchers have yet to look at the influence of dirty money on the consumable itself. Evidence from two studies suggest that the documented effects of dirty money on spending may have more to do with dirty money contaminating the purchase, as opposed to the current belief that consumers merely want to rid themselves of disgusting things. The authors find that people indeed spend more with dirty money, but only when the bills lower product valuations. This does not occur when people purchase products with inherent properties that cannot be contaminated; in fact, dirty money can increase valuations and preference for these products. The results suggest that the physical appearance of money plays a much larger, more nuanced role in consumption than previously thought, and this effect may not be entirely positive for the consumer. © 2014 Society for Consumer Psychology. Published by Elsevier Inc. All rights reserved. Keywords: Disgust; Contamination; Dirty money; Product valuations; Spending
Introduction There has been growing interest in exploring the impact of dirty money (in the literal sense) on consumption-related behavior (Di Muro & Noseworthy, 2013; Yang et al., 2013). In a recent example, Di Muro and Noseworthy (2013) used crumpled new bills to tap normative beliefs that money is dirty. The authors found that disgust derived from worn bills encourages consumers to rid themselves of the notes, thus increasing spending. This is consistent with the finding that disgust can trigger goals of expelling (Lerner, Small, & Lowenstein, 2004). This work generated significant media attention under the premise that dirty bills may fuel the economy. Indeed, there may be a quantifiable benefit to leaving ☆ The authors would like to thank the NOESIS: Design, Innovation, and Consumption Laboratory. This research was funded by the Social Sciences and Humanities Research Council of Canada (SSHRC insights grant #435-2013-0235). ⁎ Corresponding author. E-mail addresses: [email protected] (C. Galoni), [email protected] (T.J. Noseworthy).
worn bills in circulation; however, researchers have yet to account for what this means for the products purchased with dirty money. The law of contagion posits that when a source comes in direct or indirect contact with a target, the source can transfer some, if not all, of its properties to the target (Frazer, 1959 [1890]; Rozin & Nemeroff, 1990). The target then retains the properties received from the source even after the contact has been broken (Rozin & Nemeroff, 1990). This transference can happen for both positive and negative properties, and contact does not have to be physical for transference to occur (Nemeroff & Rozin, 1994; Rozin & Nemeroff, 1990). Evidence suggests that both consumers and products can be contagious. For example, Argo, Dahl, and Morales (2006, 2008) found that ratings for a particular product can be raised or lessened depending on the qualities of the people who came in previous contact with that product. Morales and Fitzsimons (2007) found that ratings for a particular product can be lessened if the product comes into physical contact with a normatively disgusting product (i.e., feminine napkins). This research offers evidence for how the contagious antecedents of a purchase can impact ratings for that purchase. Given that money is a required
http://dx.doi.org/10.1016/j.jcps.2014.11.002 1057-7408/© 2014 Society for Consumer Psychology. Published by Elsevier Inc. All rights reserved. Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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and constant antecedent for purchases, we posit that money itself can be contagious; that is, the perceived properties of money can transfer and impact beliefs about the products it purchases. This idea is not without support. What much of the research on negative contagion has in common is the concept of disgust. Disgust is a visceral emotion believed to have evolved specifically to serve the function of avoidance (Rozin, Haidt, & McCauley, 1993). Researchers have shown that unresolved disgust can lower selling and buying prices, and influence one's willingness to stick with the status quo (Han, Lerner, & Zeckhauser, 2012; Lerner et al., 2004). One very prominent source of disgust is the fear of pathogen transference (Tybur, Lieberman, & Griskevicius, 2009). Pathogen disgust can be elicited through visual cues that are normatively linked to pathogen presence, even when such cues are devoid of infectious agents (Rozin, Millman, & Nemeroff, 1986). Critically, pathogen disgust will often lead people to reject or devalue the seemingly contaminated object (Rozin & Fallon, 1987; Rozin & Nemeroff, 1990; Rozin et al., 1986; Rozin et al., 1989; Rozin et al., 1993). This is important because money itself is laden with pathogens. Recent research —aptly named the “Dirty Money Project”—conducted at New York University revealed that an average $1 bill (USD) houses over 3000 types of bacteria (Hotz, 2014). This statistic reflects a dominant belief in society that money is quite literally dirty. Thus, we propose that touching something that is normatively disgusting (e.g., dirty money) may transfer and affect the valuations of objects that are subsequently touched (e.g., a product). This idea is not as farfetched as it may seem. At one time or another, we have all been asked to wash our hands after touching something that is normatively filthy for fear of pathogen transfer. The following studies were designed to test this prediction. Overview of the present research We conducted two studies to investigate how dirty money can influence product valuations and consequently alter choice behavior and spending. In Study 1, we demonstrate that consumers who are disgusted by dirty bills put less value on their purchases and this leads them to seemingly compensate by buying more items. In Study 2, we explore whether the results of Study 1 are due to the threat of contamination of the products or due to goals of expelling the disgusting bills. The results support the former. Specifically, despite that consumers were generally disgusted by dirty bills, Study 1 replicated only when consumers were permitted to touch the products. Moreover, by unconstraining the choice of product category, we find that consumers who are disgusted by dirty bills become more likely to shop for cleaning products. Critically, if permitted to touch the cleaning products, product valuations increase and no compensatory spending takes place. Study 1 In Study 1, we establish the phenomenon that dirty money can drop product valuations and this, in turn, can lead to
increased consumption. Specifically, we provide individuals with either worn or crisp bills and then permit them to shop in a mock retail setting. We then record purchase quantity and total spending, as well as capture post purchase valuations of the products. Method Participants (N = 72, 67% female, Mage = 41.71) were recruited through advertisements and public posters, and were tested one at a time in a mock retail setting. Upon entering the setting, each participant was presented with a box consisting of several sealed white envelopes. Participants were informed that each envelope contained anywhere from $10 to $30. They were instructed to select one envelope, open it, take out the money, and confirm the amount. This ensured that participants touched the money before engaging in the retail transaction. Despite the guise, all envelopes contained a $20 bill. The range of the guise ensured that the $20 gain was not coded as a relative win or loss within the realm of chance. The only thing that varied between participants was whether the bill in the envelope was worn or crisp. Untarnished notes were requisitioned from a local bank. The worn condition was manipulated by crumpling and discoloring the bills whereas the crisp bills were left unaltered. Upon taking the bill in hand, participants were directed to the store aisle. The products on the shelves were all food-related. What varied was their nutritional value under the guise that we were exploring if people select healthier versus less healthy snacks when awarded a cash windfall (see appendix). The products ranged from $1.00 to $3.50, and were organized such that an adjacent healthier option of equal price was always available. Participants were instructed to purchase at least one item and were instructed that all products purchased as well as the remaining change would be theirs to keep following the study. Upon completing the selection, the cashier generated a receipt that recorded the experimental condition (using a non-descript identifier), the number and name of the products, and the entire basket amount. The cashier then administered the appropriate change along with a copy of the receipt. Participants were then directed to a cubicle to fill out a questionnaire. In step with Di Muro and Noseworthy (2013), the manipulation check asked participants to judge the degree to which the bill they used was worn-out (anchored 1 = not at all worn, 7 = very worn). Participants were then instructed to focus specifically on how the bill made them feel, and respond to four 5-point items (anchored 1 = not at all, 5 = extremely) that captured perceived disgust (disgusted; unclean; dirty; revolted; Morales & Fitzsimons, 2007). Unlike Di Muro and Noseworthy who assessed the perceived value of the bills, participants were asked to rate the value of each of the products they purchased on eleven 7-point items (anchored 1 = strongly disagree, 7 = strongly agree). Five of the items tapped participants' perceptions of product value (has consistent quality; is well made; would not last long; something I would enjoy; something that would give me pleasure) and six items captured participants' perceptions of usage value (something that I would want to use; something that I would feel relaxed
Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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about using; would help me to feel accepted; would improve the way I am perceived; would make a good impression on others; would give its owner social approval; adapted from Di Muro & Noseworthy, 2013). Participants were then asked to record their general affective state using the 20-item Positive and Negative Affect Schedule (PANAS; Watson, Clark, & Tellegen, 1988). The questionnaire concluded with basic demographic questions. Results and discussion Manipulation and confound check A manipulation check confirmed that consumers rated the altered bills as more worn-out (M = 6.36, SD = 1.15) than the unaltered bills (M = 2.56, SD = 1.79), t(70) = 10.71, p b .001, d = 2.53. Importantly, despite the spending prioritization guise, this effect did not influence product selection. Specifically, a selection index was created within subjects by subtracting the number of healthier choices from the number of less healthy choices divided by the total basket of goods. The index was such that a negative number implied healthier selections, whereas a positive number implied less healthy selections. The results revealed that the physical state of the bills did not influence choice (MWorn = − .14 vs. MCrisp = − .24, ns). Furthermore, the physical state of the bills did not influence participants' affective state, be it positive (MWorn = 3.08 vs. MCrisp = 3.07, ns) or negative (MWorn = 1.69 vs. MCrisp = 1.48, ns). This suggests that any observed change in valuation across the worn and crisp conditions could not be attributed to participants' affective state or their selection criterion. Hypothesis testing An analysis of state-driven disgust (α = .71) revealed that participants were more disgusted by the worn bills (M = 1.45, SD = .63) than by the crisp bills (M = 1.12, SD = .36), t(70) = 2.85, p b .01, d = .67. Consistent with the results of Di Muro and Noseworthy (2013), these inferences translated into differences in spending. Specifically, participants spent more when they purchased with worn bills (M = $5.85, SD = $3.28) than when they purchased with crisp bills (M = $4.25, SD = $2.39), t(70) = 2.36, p b .05, d = .56. Critically, close inspection revealed that participants did not buy more expensive items (MWorn = $2.14 vs. MCrisp = $2.04, ns), but instead they purchased more items (MWorn = 2.89, SD = 1.67 vs. MCrisp = 2.14, SD = 1.18), t(70) = 2.20, p b .05, d = .51. The core prediction was that this may have something to do with the value consumers see in the products purchased with worn bills. In support of our core prediction, there was a significant effect of the physical state of money on perceived product value (α = .71), such that products purchased with worn bills were seen as less valuable (M = 5.39, SD = .81) than products purchased with crisp bills (M = 5.80, SD = .89), t(70) = − 2.01, p b .05, d = .47. To test whether disgust led to the drop in valuation, which in turn increased spending, a serial mediation analysis was conducted whereby the indirect effect and the standard error of the indirect effect were estimated using a bias-corrected bootstrap with 5000 draws (Hayes, 2012;
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MacKinnon, Lockwood, & Williams, 2004, Model 6). Despite the absolute means for disgust being relatively low, the results yielded a significant indirect effect of the physical state of money on spending through disgust and then product valuation, 95% CI [− .642, − .002]. Furthermore, the direct effect of the physical state of money on spending was no longer significant, path c′: B = − .59, SE = .62, ns. Importantly, participants in the worn banknote condition put just as much value on owning the items as did participants in the crisp banknote condition (α = .82; MWorn = 4.24 vs. MCrisp = 4.17, ns). Study 1 raises two important questions: First, if dirty money can contaminate a purchase and subsequently drop product valuations, is it possible that dirty money may lead someone to put more value on, and even become more likely to select, products that combat pathogen transfer? This is critical because if dirty money can both raise and lower product valuations, one would be hard pressed to argue that the effects are solely due to people wanting to rid themselves of disgusting things (Di Muro & Noseworthy, 2013; Lerner et al., 2004). Second, if the valuation effects are indeed the result of pathogen disgust, there is the question of whether we are tapping physical or symbolic contamination. Nemeroff and Rozin (1994) first introduced the idea of non-physical contagion. The authors showed that contamination can manifest as the symbolic meaning implied by interacting with an object (e.g., If one wears Hitler's sweater, one is implying acceptance of him), or through associations that the object has with others (e.g., Inherited money can be contaminated with memories of the deceased; Levav & McGraw, 2009; Tykocinski & Pittman, 2013). However, several findings suggest that for product valuations to drop in a regular (non-contaminated) object, there must be a real threat of pathogen transfer and thus contact must be physical (Argo et al., 2006; Morales & Fitzsimons, 2007). In no instance in study 1 did the money come into physical contact with the products, but it did come in contact with the consumer. If we are to assume a physical path to contamination, then it would have to flow through the consumer. Conversely, a symbolic path to contamination would argue that merely being disgusted would generate the observed effects. Study 2 was designed to address these questions. Study 2 Study 2 examines whether the influence of dirty money on spending is the result of the bills contaminating the purchases or merely due to disgust priming goals to expel. Specifically, we examine (1) if disgust alone can predict the results or whether individuals need to touch the products for valuations to drop, and (2) if the influence of dirty money on product valuations depends on what the individual buys, regardless of his or her state of disgust. Method Participants (N = 202, 57.9% female, Mage = 26.27) were recruited through newspapers and public posters, and were randomly assigned to one of four conditions in a 2 (physical appearance: worn vs. control) × 2 (instructions: touch vs. no
Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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touch) between-subjects design. The procedures and dependent measures were consistent with study 1, with the following alterations: First, to test whether dirty money can alter choice behavior, the store was redesigned to have office supplies along one aisle and cleaning supplies along the other (see appendix). Following the bill manipulation, participants were instructed that they may peruse both isles, but may only choose one aisle to do their purchasing. Consistent with study 1, participants were required to purchase at least one item in that aisle, and they were informed that all purchases as well as the remaining change would be theirs to keep. Furthermore, given that our focus was on consumer inferences about worn bills and not the value that consumers place on new bills, the crisp bills were replaced with standard (control) bills dispensed from a local bank machine. Care was taken to ensure that the bills were the same stylized printing and similar date of issuing across both conditions. The manipulation of the worn bills followed the exact same procedure described in study 1. Second, to explore whether the observed effects from study 1 resulted from the physical path or the symbolic path to contamination, participants were either instructed to collect their products themselves and bring them to the cashier (touch condition; replicating study 1) or to examine the products closely without touching them and then inform the cashier of their selection (no touch condition). In both conditions, participants were told that the selected products would be available at the front of the room when the task was complete. Importantly, to ensure information was symmetrical across the two touch conditions, participants in the touch condition were not permitted to handle the products and peruse the ingredient lists, but only to pick up the products and bring them to the cashier. Finally, the questionnaire remained identical with study 1 with the addition of a measure to ensure that the bills were not altering participants' affective judgments of the product (anchored: 1 = not at all; 7 = extremely; “Likeable,” “Appealing,” “Favorable,” “Enjoyable”). In addition, we included an open-ended question asking participants to justify their product selection, and we rotated the disgust questions to follow the valuation questions in an effort to ensure that there were no carry-over effects from prompting disgust on the valuation results. Results and discussion Manipulation check and confound check Consistent with study 1, consumers rated the altered bills as more worn-out (M = 6.06; SD = 1.56) than the unaltered bills (M = 3.17; SD = 1.81), F(1,198) = 147.09, p b .001, η2 = .42. Importantly, the main effect of touch on perceptions of wornness was not significant, F(1,198) = .04, ns. Neither was the physical appearance × touch interaction, F(1,198) = 1.78, ns. Furthermore, the manipulation of the bills did not influence participants' affective state (positive or negative, Fs b 2), nor did it influence participants' affective response to the products (α = .87; Fs b 1). As in study 1, participants were generally more positive (M = 3.21; SD = .73) than negative (M = 1.52;
SD = .57), F(1,198) = 723.76, p b .001, η2p = .75. Thus, once again, the manipulation of the bills worked as intended. Disgust A two-way ANOVA revealed a main effect of the physical appearance of the bills on state disgust (α = .72), such that participants were more disgusted by the worn bills (M = 1.35; SD = .59) than by the standard bills (M = 1.20; SD = .34), F(1,198) = 5.09, p b .05. η2 = .02. The physical appearance × touch interaction was not significant, F(1,198) = .03, ns. Thus, the influence of the physical appearance of money on state disgust did not vary by touch. This is important because if this were disgust initiating goals of expelling then participants should demonstrate equivalent effects regardless of whether they touched the bills. However, if this is more about a fear of pathogens contaminating the products, then choice selection and spending should vary by touch. Aisle selection and spending As it is inappropriate to model choice and quantity decisions separately when the quantity decision is not statistically independent of the choice decision (i.e., when there may be selectivity artifacts; Heckman, 1979; Jedidi, Mela, & Gupta, 1999; Krishnamurthi & Raj, 1988), we estimated a model that corrected for a possible selection bias using Lee's (1983) generalization of Heckman's (1979) two-stage-least-squares (2SLS) procedure. Selectivity artifacts are commonly encountered in experimental situations where only certain items survive to be observed at a later stage. In our case, because we were interested in whether the bills primed individuals to select a specific store aisle, we could not randomly assign the individuals to the store aisles. Thus, any assessment of spending within one specific aisle has to account for the fact that the initial aisle selection process limits which items offer up subsequent information. Overall, the estimates revealed no significant correlation among the residuals, implying the absence of a selection bias, ρ = .01, σ = 4.76, ns. Despite the above, the results of the model supported our core prediction. Specifically, those who were given worn bills and permitted to touch the products were more likely to choose the cleaning supplies aisle over the office supplies aisle, B = − .78, SE = .37, p b .05. However, as illustrated in Fig. 1, those who did select the office supplies aisle, and were permitted to touch the products after handling the worn bills, subsequently purchased more items, B = .91, SE = .43, p b .05, and thus spent more money, B = 4.37, SE = 1.81, p b .05. Critically, individuals did not spend more money when they selected the cleaning supplies aisle, and they did not spend more money in either aisle when touch was prohibited. This suggests that only when individuals were permitted to touch the products did the physical state of the bills alter choice behavior. Again, given that perusal of the packaging was prohibited, this effect cannot be attributed to greater search yielding refined preference. As in study 1, the observed increase in spending was expected to correspond with a decrease in product valuations. As illustrated in Fig. 2, an analysis of perceived product value
Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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Fig. 1. Total spending separated by aisle selection. (Standard errors included).
(α = .81) revealed that participants who were permitted to touch the products put less value on the office supplies in the worn bill condition (M = 4.93, SD = 1.12) than in the standard bill condition (M = 5.52, SD = .93), F(1,198) = 3.85, p b .05, η2 = .02. As expected, this effect did not manifest when touching the products was prohibited (MWorn = 5.31 vs. MStandard = 5.43), F(1,198) = .17, ns. Furthermore, in support of our valuation prediction, the results reversed for those who chose cleaning products. Specifically, participants who were permitted to touch the products put more value on the cleaning products in the worn bill condition (M = 5.73, SD = 1.21) than in the standard bill condition (M = 5.06, SD = 1.19), F(1,198) = 3.52, p = .062, η2 = .02. Again, this effect did not manifest when touching the products was prohibited (MWorn = 5.12 vs. MStandard = 5.15), F(1,198) = .01, ns. A follow-up check of participants' rationale for their choice selection, coded by two unaffiliated judges (r = .87), revealed no material difference in participants justification for their choice. The most common responses were, “I chose what I would choose if at a real store,” or “I prioritized exactly as I do normally.” Thus, the physical appearance of money not only alters product valuations, but also choice selection, and importantly, it does so in way that relates more to changes in the product's value than to a desire to rid oneself of dirty money. General discussion Given the recent economic recession, there has been considerable media attention around the need to decrease government
spending while increasing domestic spending. The results from recent work suggest that governments may be better served, both in terms of domestic spending and currency production costs, by leaving worn bills in circulation (Di Muro & Noseworthy, 2013). Indeed, the Federal Reserve may be better served, but the results of this study suggest the consumer may not be. Thus, with the recent interest in exploring the effects of currency on consumption behavior (e.g., Di Muro & Noseworthy, 2013; Xie, Yu, Zhou, Sedikides, & Vohs, in press; Yang et al., 2013), the results caution that researchers should not ignore the consumable itself. Evidence from two studies brings up the possibility that the observed influence of dirty money on spending could be the result of consumers offsetting lower product valuations by purchasing more items, not by consumers wanting to rid themselves of dirty bills. This suggests that the effects observed in prior work may have more to do with product utility than with goals of expelling. In support of this, we found that dirty money can actually raise valuations for, and shift preference towards, products that fend off contamination. Critically, when this occurs, spending does not increase, arguably because there is no diminished utility to be offset by volume. These results present the first account of negative contamination augmenting product valuations. The question going forward is why would someone buy more of something in which they see less value? Might these findings be related to consumer goals? Future research could explore if the devaluation of dirty bills prompts consumers to regain value, hence leading to a greater incidence of purchase. That is, if spending goals were violated by the reduced implicit
Fig. 2. Product valuations separated by aisle selection. (Standard errors included). Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002
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value of the bill, would someone then attempt to reaffirm these goals by spending more? This same concept of a reduction in implicit value could extend into other work. For example, Yang et al. (2013) found that farmers given dirty money would cheat customers by giving less than the 500 g of produce that the customer had paid for. Could it be that it was not so much that farmers were deliberately cheating, but that they gave what was perceived to be of equivalent utility to the dirty bills? This would be an interesting avenue to explore. Our findings are not without limitations and present many opportunities for future work. First, given that the purpose of study 2 was primarily to explore whether dirty money could prime choice behavior, it is important to reiterate that individuals were not randomly assigned to the store aisles. Not only did this pose some challenges and limitations from a statistical perspective, but it also raised the question of whether there is a motivational effect in the valuation results. It would be interesting to see if the same results would hold if we forced someone to purchase cleaning supplies. It would also be interesting to test which specific attributes are affected by disgust using a discrete choice methodology that compares across store aisles (e.g., Noseworthy, Wang, & Islam, 2012). One would expect that consumers would put more weight on attributes related to fighting pathogens when they are disgusted with dirty bills. Furthermore, although the results seemingly support the physical path to contamination, there is the possibility that having participants not touch the product influenced their valuations in different ways that extend beyond the type of contamination. This is important because researchers have linked touch to endowment (Peck & Shu, 2009), and have linked disgust to endowment (Lerner et al., 2004). Thus, could it be that the influence of dirty money on product valuations was suppressed in the no touch condition because participants lacked ownership? We were quite cognizant of this possibility and incorporated a follow-up check. Specifically, before participants were discharged from the lab, a confederate, who was unaware of the hypotheses, approached the participants and asked what they would be willing to accept for each product if we were to buy the products back to keep the shelves stocked. Consistent with research on the endowment effect, when participants in study 2 purchased with standard bills, average selling price (MSell = $3.88; SD = $1.91) exceeded the average buying price (MBuy = $3.42; SD = $1.35), F(1,198) = 6.93, p b .01, η2p = .03. Consistent with the findings of Lerner et al. (2004), endowment did not manifest when participants were disgusted by the worn bills (MSell = $3.43 vs. MBuy = $3.60), F(1,198) = 1.06, ns. Critically, this pattern of effects did not vary by touch (Fs b 2). Thus, participants were endowed whether they touched the product or not, and more importantly, the influence of disgust on endowment did not vary by touch. Therefore, it seems that endowment could not account for the observed effects. That said, future research could isolate whether this was indeed physical transference. Given that the physical path would have to assume transference through the consumer, the finding that touching normatively disgusting
objects and then touching a product can contaminate the product could have some very interesting implications for future work. Lastly, it is also possible that the observed effects may have had something to do with participants liking the worn bills less. However, across both studies there were no differences in the value participants placed on owning the products purchased or in their affective states. Furthermore, in study 2, participants' affective response to the products did not vary by the bill condition. Thus, if they did like the bills less, this did not transfer to the products they purchased. This does, however, raise the question of how aware participants were of their selection. We found no explicit evidence in participants' thoughts to suggest that they were deliberately looking to fend off contamination. It seemed that the effect was entirely driven by the value they placed on the object. Indeed, the estimated utility derived from worn currency could go a long way in explaining current theoretical accounts. Certainly more research is needed in this area. Appendix A. Supplementary data Supplementary data to this article can be found online at http://dx.doi.org/10.1016/j.jcps.2014.11.002. References Argo, J. J., Dahl, D. W., & Morales, A. C. (2006). Consumer contamination: How consumers react to products touched by others. Journal of Marketing, 70(April), 81–94. Di Muro, F., & Noseworthy, T. J. (2013). Money isn't everything but it helps if it doesn't look used: How the physical appearance of money influences spending. Journal of Consumer Research, 39 (April), 1330–1342. Frazer, J. G. (1959 [1890]]). The Golden Bough: A study in magic and religion. In T. H. Gaster (Ed.), New York: McMillan. Han, S., Lerner, J. S., & Zeckhauser, R. (2012). The disgust-promotes-disposal effect. Journal of Risk and Uncertainty, 44(2), 101–113. Hayes, A. F. (2012). PROCESS: A versatile computational tool for observed variable mediation, moderation, and conditional process modeling. White paper (http://www.afhayes.com/public/process2012.pdf). Heckman, J. J. (1979). Sample selection bias as a specification error. Econometrica: Journal of the Econometric Society, 153–161. Hotz, R. L. (2014). Why you shouldn't put your money where your mouth is. The Wall Street Journal (Retrieved from http://biology.as.nyu.edu/page/news). Jedidi, K., Mela, C. F., & Gupta, S. (1999). Managing advertising and promotion for long-run profitability. Marketing Science, 18(1), 1–22. Krishnamurthi, L., & Raj, S. P. (1988). A model of brand choice and purchase quantity price sensitivities. Marketing Science, 7(1), 1–20. Lee, L. F. (1983). Generalized econometric models with selectivity. Econometrica: Journal of the Econometric Society, 507–512. Lerner, J. S., Small, D. A., & Lowenstein, G. (2004). Heart strings and purse strings: Carryover effects of emotions on economic decisions. Psychological Science, 15 (May), 337–341. Levav, J., & McGraw, A. P. (2009). Emotional accounting: How feelings about money influence consumer choice. Journal of Marketing Research, 46(1), 66–80. MacKinnon, D. P., Lockwood, C. M., & Williams, J. (2004). Confidence limits for the indirect effect: Distribution of the product and resampling methods. Multivariate Behavioral Research, 39 (January), 99–123. Morales, A. C., & Fitzsimons, G. J. (2007). Product contagion: Changing consumer evaluations through physical contact with ‘disgusting’ products. Journal of Marketing Research, 44 (May), 272–283.
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Please cite this article as: Galoni, C., & Noseworthy, T.J., Does dirty money influence product valuations? Journal of Consumer Psychology (2014), http://dx.doi.org/ 10.1016/j.jcps.2014.11.002