Savings, subgoals, and reference points

Date

2013-01
Language
English

Embargo Lift Date

Department

Committee Members

Degree

Degree Year

Department

Grantor

Journal Title

Journal ISSN

Volume Title

Found At

Society for Judgment and Decision Making

Abstract

Decision makers often save money for a specific goal by forgoing discretionary consumption and instead putting the money toward the savings goal. We hypothesized that reference points can be exploited to enhance this type of saving. In two hypothetical scenario studies, subjects made judgments of their likelihood to forgo a small expenditure in order to put the money toward the savings goal. In Experiment 1, judgments were higher if the savings goal was presented as composed of weekly subgoals (e.g., save $60 per week to buy a $180 iPod). Experiment 2 replicated this finding and demonstrated that the subgoal manipulation increased judgments of likelihood to save money only when the money saved from the foregone consumption would allow the decision maker to meet the weekly subgoal exactly (not under or overshoot it). These results suggest a reference point mechanism and point to ways that behavioral decision research can be harnessed to improve economic behaviors.

Description

item.page.description.tableofcontents

item.page.relation.haspart

Cite As

Colby, H., & Chapman, G. B. (2013). Savings, subgoals, and reference points. Judgment and Decision Making, 8(1).

ISSN

Publisher

Series/Report

Sponsorship

Major

Extent

Identifier

Relation

Journal

Source

Alternative Title

Type

Article

Number

Volume

Conference Dates

Conference Host

Conference Location

Conference Name

Conference Panel

Conference Secretariat Location

Version

Full Text Available at

This item is under embargo {{howLong}}