Spending and Happiness: The Role of Perceived Financial Constraints

Abstract Perceived financial constraints are ubiquitous, and prior research suggests that consumers who feel financially constrained especially likely to engage in compensatory consumption signal positive attributes or offset the aversiveness associated with their state. However, it is unclear whether spending confers greater happiness when constrained. Seven high-powered studies (N = 7,228) demonstrate perceived decrease derive from purchases. This effect robust across several purchase types occurs part because perceive more consider opportunity costs evaluating purchases (studies 2A 2B). Consistent this mechanism, attenuates all prompted (study 3) planned 4). The negative of on results an important behavioral outcome: less favorable consumer reviews 5A 5B). authors conclude by meta-analyzing file drawer (25,765 participants; 42 studies) explore how differs discussing theoretical practical implications for marketers.