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Tuesday, November 22, 2016

The Psychology of Money

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November 22, 2016. Shanghai – No matter how much money we have, or what we spend it on, money affects our psychology said Assistant Professor of Marketing, Hyun Young Park. She explained the psychology of money, and some of her latest research findings, in a captivating Meet New Faculty Lecture tonight at the Shanghai Campus.

Past research shows: Looking at an image of money, touching money, or being exposed to play money will improve our work performance, in particular, persistence in challenging tasks, she said. Money also tends to cause us to express both good and bad emotions much less, and also makes us more selfish and less perceptive about the emotions of others. We feel colder and less physical pain after touching or counting money compared to plain paper. It even makes us less afraid of death, she said.

Money and guilt has been a research focus of Professor Park. She explained that when we feel guilty, for instance, after lying or gossiping, we tend to engage in prosocial activities to restore our failed moral self-image. In particular, guilty people prefer to give their time over money as giving time is more closely related to our identity and thus is more effective in redeeming our moral self. But when we feel guilty about the money we have, for instance, after stretching the truth to get a refund or getting compensation after overstating our performance, we prefer to spend that tainted money prosaically, more than our time or other, untainted money. In other words, we isolate guilt to specific set of money instead of incorporating the moral failure to our self-image, and strive to cleanse that ‘tainted’ money rather than redeem our failed moral self. In addition, after giving some of the tainted money, we perceive the remaining money as ‘clean’ – a psychological money laundering of sorts.

The audience, which included Professor of Entrepreneurship S. Ramakrishna Velamuri and Associate Professor of Strategy Peter Moran, was intrigued and raised many questions after the lecture.

Dr. Park earned her PhD in Marketing from New York University and Bachelor in Business Administration, with highest honours, from Seoul National University. Her research focuses on how morality and emotion influence judgment and decision making. In particular, she examines how moral emotions such as anger, guilt, gratitude, and pride influence consumer spending decisions and mental accounting. Her work experiences at A.T. Kearney, Bain & Company, and L’Oréal are what piqued her interest in the effects of branding on consumer identity and information processing. Her extensive volunteer work experiences in Central Asia and Haiti have inspired her interest in charitable giving and non-profit organisations.

Writer: 
Verena Kohleick
Editor: 
Janine M. Coughlin