Behavioral Economics Commons^™

Our Temptation For Benjamins: Can Framing Spending Habits Allow Us To Overcome Present Bias?, Deniz Aytac

Economics Student Theses and Capstone Projects

This study will investigate whether people prefer spending their cash on hand for instantaneous benefits, or delay consumption for future returns, and the impact of their mood on their spending habits. Past studies find that one’s state of happiness immensely contributes to his or her willingness to spend money; happier, satisfied individuals tend to spend a lot less than dissatisfied ones. However, few studies focus on the impact of loss aversion on people’s time preferences towards money. The goal of this paper is to measure not only the impact of happiness as the same mood-congruent effect on time preferences but …