Discourses of savings

Katona (1975) established the importance of social perception variables in mediating the impact of economic conditions on financial decision making. There has been a tradition of work in economic psychology that has elaborated on this early work. However, clearly the economic and social circumstances for the contemporary consumer are vastly different to those studied by Katona. The present study uses a qualitative analysis of focus group material to investigate lay people's understanding of savings. Interpretation of extracts from the focus groups suggests a complex understanding of the relation between saving and social and economic change. There was a concern with uncertainty, regulation and the moral economy. The findings were interpreted in the light of theories of the risk society.     

Risky discounts: Do people prefer them on a per-item or per-purchase basis and why?

Risky discounts differ from other discount formats in that the actual discount level is determined by chance (e.g., “scratch & save” cards). Four studies investigated whether consumers prefer to receive risky discounts on a per-purchase or per-item basis. Although these options do not differ with regard to expected value, they entail multiple differences (e.g., savings distribution, amount of individual gains, excitement, and effort involved) that may lead to differential consumer perceptions and experiences. Controlling for expected value of savings, participants preferred per-item over per-purchase discounts. As hypothesized, the main reasons for this preference were a partly incorrect perception of the properties of the savings distribution, the adoption of a narrow mindset focusing on the best outcome in a series of discount gambles, and the greater excitement provided by multiple discount gambles.     

Financial management, coping and debt in households under financial strain

This study looks at how households cope financially with a budget under a certain financial strain (after the birth of a new baby), and particularly examines their financial management practices and debting behaviour. Other factors associated with debt status caused by financial strain — particularly psychological variables — are also examined. A number of indexes were calculated from questionnaire data and used to measure these variables. The results showed that being in debt was significantly associated with feelings of coping less well and with better financial management. Better coping was also significantly associated with being more ‘forwardlooking’ and having a more negative attitude towards debt. Better financial strategies were significantly associated with being less materialistic and having a more stable budget. The results confirm previous findings that psychological and behavioural variables have a considerable impact on being in or keeping out of debt, but also suggest that perceived poor coping and being in debt during a period of particular financial strain may actually lead to an improvement in financial management.     

Subjective discount rates among Israeli Arabs and Israeli Jews

In this study, we compare the subjective discount rate for Israeli Jews and Arabs. All the subjects were bank customers, who were asked to bid and ask prices for delayed fixed amounts and for lotteries. The two populations live in the same country under the same laws. Nevertheless, according to the literature, Israeli Arabs seem to be a discriminated minority, who exhibit traits of a traditional collectivist culture, while Israeli Jews are a majority, who exhibit traits of an individualistic culture. As a discriminated minority, Israeli Arab may suffer from lower trust and as a result, according to the “trust” hypothesis, exhibit higher subjective discount rates and higher risk aversion. On the other hand, according to the “cushion” hypothesis, a collectivist society such as Israeli Arabs, provides a safety net for the individual and as a result, he will exhibit lower subjective discount rates and lower risk-aversion. The experimental findings show that the subjective discount rate and risk aversion of Israeli Arabs are significantly higher than that of Israeli Jews. Moreover, higher percent of Israeli Jews are at the low range of the discount rates (below 10%) and lower percent of Israeli Jews are at the high range of discount rate (above 20%) compared to Israeli Arabs. This is consistent with the “trust” hypothesis. For Israeli Jews, the discount rates are closer to the bank interest rate, while Israeli Arabs rates are much higher particularly for receipt. The dispersion of the distribution of discount rate is much larger for Arabs than for Jews.     

Money matters: An exploratory study of the socio-cultural context of consumption, saving, and investment patterns

This study focuses on 36 professional South Asian (Indian) families in a metropolitan city in Canada in order to understand motives for financial behavior. In accordance with the Hindu world view, Indians view wealth acquisition as necessary for the natural progression of an individual's life and take a long view of time when it comes to investment decisions. Their primary purpose is to invest money in order to provide for their children's education. Their cultural roots allow them to take a long-term view and makes them more risk tolerant. Although these families take economic criteria into account, such criteria alone do not fully explain their consumption, saving, and investment patterns. It would appear that their need for saving determines their consumption, not the other way around. To understand their financial behavior, one has to identify the cultural worlds in which Indians live. The study highlights the importance of understanding the socio-cultural context of decisions that may appear to be purely economic decisions at first sight.     

Full-time, part-time employment and life satisfaction of the elderly

There is continued interest in employment and subjective well-being among the elderly because of the increasing proportion of elderly population in the labor force. This study investigates the association between part-time and full-time employment and life satisfaction of the elderly in Taiwan. We also examine how these associations may differ across socio-demographic groups. An ordinal treatment effect model is developed to accommodate the discrete feature of the employment decision and the potential endogeneity of these two outcomes. Using a unique sample of the elderly in Taiwan, in contrast to findings for the general population of the previous studies, we find that part-time employment is significant and positively associated with life satisfaction, while elderly with full-time employment have lower life satisfaction. These results are robust across socio-demographic groups.     

Subjective time discount rates among teenagers and adults: Evidence from Israel

This study is an empirical examination of the personal discount rates used by teenagers and adults. The participants answered a time-preference questionnaire and were asked about the bank interest paid for deposits. The results demonstrate that teenagers have a very high personal discount rate in comparison to adults. In addition, we found that receiving a regular allowance increases the teenagers’ willingness to wait. Our results indicate that the influence of teenagers’ poor financial knowledge, which ought to increase the personal discount rate, is stronger than the effect of their safety net that should reduce the personal discount rate.     

Contextualizing subjective well-being of children in different domains: Does higher safety provide higher subjective well-being for child citizens?

According to the United Nations Convention on the Rights of the Child, all children are born with civil, political, social and economic rights. However, children's ability to exercise their citizenship rights and practices depend on which country context they live in. Within the limits of this article we want to explore how children's subjective wellbeing is affected by the level of safety provided within the larger country context by using data collected by the consortium of the International Survey of Children's Well-Being. The question we elaborate is whether there is a relationship between the welfare context and subjective well-being of children with respect to different domains, and whether age and gender play a role. We first cluster welfare contexts with selected indicators from international reports among the selected countries of the Children's World Survey from high to low safety provided for children. Then, by referring to the existing literature, we propose six domains for analyzing children's subjective well-being: Health; Material conditions; Education; Risk and Safety; Relationships, and Self-perception. By analyzing each domain we ask whether there is a linear relation between the levels of safety welfare contexts and the subjective well-being of children in different domains and whether this hypothetical relationship exists after controlling for the age and gender of participants. According to our findings, high and medium welfare contexts provide higher subjective well-being in the domains of ‘material’ and ‘risk and safety’. Girls have lower subjective well-being in the low safety welfare context compared to boys. We also find that in the domains of education and relationship, girls' subjective well-being is higher than boys in every safety welfare contexts. Last but not least we also find that the high safety welfare context has a lower average in the self-perception domain and also there is gender difference, girls compared to boys are less satisfied with themselves.     

Urban Aboriginal use of fringe financial institutions: Survey evidence from Prince George, British Columbia

This paper analyses the use of fringe financial institutions (FFIs), such as payday loan and check cashing providers, by urban Aboriginal people based on a survey undertaken in Prince George, British Columbia. We found that 60% of FFIs’ clients surveyed self-identified as Aboriginal. Their characteristics, compared to the non-Aboriginal FFI clients, included having lower average incomes, lower levels of education, more likely to be female, a higher incidence of being unemployed, higher levels of financial exclusion, and less satisfaction with the service provided by FFIs. We find that government policy towards regulating the FFI industry is inadequate for meeting the basic financial needs of urban Aboriginal people.     

The Perceptive Proletarian: Subjective Social Class Predicts Interpersonal Accuracy

Interpersonal accuracy correlates modestly across different domains. Although some research has explored factors that predict accuracy within specific domains of interpersonal judgment (e.g., social attributes), whether any variables might predict interpersonal accuracy generally across different domains remains in question. Subjective socioeconomic status (SES) has recently emerged as an important moderator of various social cognitions, such as contextual focus and empathic accuracy. Moreover, people lower in SES tend to show greater interpersonal engagement and attention; thus, we wondered whether individuals with lower subjective SES might exhibit superior interpersonal accuracy in multiple domains. Indeed, across four studies, we found that subjective SES inversely correlated with accuracy in three different domains of interpersonal accuracy: social attributes, situational affect, and emotion. These findings therefore demonstrate that subjective SES may predict broad interpersonal accuracy abilities and suggest that, despite modest relationships between different types of first impression accuracy, the correlates of such accuracy can still operate across domains.     

Socio-economic determinants of suicide in Japan

Japan has the highest suicide rates among the OECD countries and this public health problem seems to be accelerating in over the recent decades. Investigating and understanding the suicidal behaviour is of crucial importance to society and health policy makers. Such an investigation could provide with useful information for those responsible in formulating the national policies on suicide prevention. This study estimates dynamic econometric models for total, male and female suicides in Japan for the period of 1957–2009. Using the ARDL approach to cointegration, we find that the associations of suicide with sociological factors (divorce and fertility rates) were stronger than those with economic factors (per capita GDP and unemployment) for females.     

Decomposing the age effect on risk tolerance

The importance of investment portfolio allocation has become more apparent since the onset of the late 2000s Great Recession. Individual willingness to take financial risks affects portfolio decisions and investment returns among other factors. Previous research found that people of different ages have dissimilar levels of risk tolerance but the effects of generation, period, and aging were confounded. Using the 1998–2007 Survey of Consumer Finances cross-sectional datasets, this study uses an analytical method to separate such effects on financial risk tolerance. Aging and period effects on financial risk tolerance were statistically significant. Implications for researchers and financial planning practitioners and educators are provided.     

Self-esteem,financial knowledge and financial behavior

Financial knowledge is an important but insufficient driver of responsible financial behavior. Having a positive evaluation of oneself may also be essential for individuals to initiate and persist with the daunting process of financial management. In this study, we distinguish subjective financial knowledge from objective financial knowledge, and we propose that self-esteem relates to financial behavior both directly as well as indirectly through subjective financial knowledge. Results based on a nationally representative dataset of U.S. adults suggest that self-esteem significantly relates to individual financial behavior after controlling for financial knowledge and other socioeconomic factors. The association between self-esteem and financial behavior could be both direct and indirect through subjective financial knowledge. These findings highlight the importance of psychological traits such as self-esteem in explaining financial behavior difference. Its implications are discussed.     

Donating-selling tradeoffs and the influence of leaders in the environmental goods game

Contributions to environmental goods are motivated by both pecuniary incentives and environmental consciousness. Public policy often uses financial incentives to encourage contributions. However, individuals often donate their time or money to the environmental cause without such incentives. The purpose of this paper is: (a) to examine the relationship between “donating” (without monetary incentives) and “selling” behavior (motivated by monetary incentives) of individuals in the context of environmental protection and (b) to analyze the influence of a leader on individual contributions to the environmental good. The major results are: (1) there is a tradeoff/substitution between donating and selling for a given level of incentives; (2) donating is much less sensitive to changes in monetary incentives and, furthermore, there is no evidence that the increase in financial incentives to sell will crowd out donations; (3) the changes in contributions by leaders have a significant impact on followers’ behavior.     

The relationship between objective and subjective wealth is moderated by financial control and mediated by money anxiety

Prior research has showed that the subjective perception of objective wealth might be affected by various individual difference variables, such as one’s love of money, level of aspirations, and materialistic inclinations. This paper examines a model of subjective wealth that controls attitudes toward money and objective wealth. Subjective wealth has been operationalized as a combination of the assessment of financial situation, the ability to make ends meet and perceived adequacy of income to fulfill needs and wants. Objective wealth has been captured by personal net income as well as household income. Results show that two dimensions of money attitudes affect the subjective perception of objective wealth. Individuals’ perceived financial control (the ability to budget, monitor, and control their money) serves as a moderator for the relationship between objective and subjective wealth: The relationship between the two is stronger for individuals high in financial control and planning than for those low. Furthermore, money anxiety (worry and indecisiveness regarding moneyrelated issues) is negatively related to objective measures of wealth and its subjective evaluation, and partially mediates the objective–subjective wealth relationship.     

Moving Up and Down the Ladder: Perceived Social Mobility and Emotional Dispositions Among South Florida's Immigrants

Migrating to a new country is often associated with difficulties such as social isolation, financial strain, language barriers, and cultural differences. Less is known about how social mobility brought about by migration may be related to the emotional dispositions of immigrants (also referred to as subjective well‐being). To examine this relationship, we utilize data from a representative sample of 1,268 first‐generation immigrants from 80 different countries living in South Florida. Changes in perceived social mobility between the homeland and the United States—moving up and down the socioeconomic ladder—are indeed associated with differences in immigrants' negative dispositions. We draw from literature on expectations, social comparisons, and subjective class status to explain these findings. We do not find a statistically significant association between changes in socioeconomic status and positive dispositions, which may suggest that losses outweigh migration‐related gains. Additionally, findings reveal that nondominant groups fare worse than Cubans (the dominant group in the region) with regard to dispositions. Social comparisons to the dominant ethnic group may explain this, as well as perceptions of relative deprivation experienced by groups not favored by immigration policies and underrepresented in social and economic institutions. We conclude by discussing implications on how negative emotional dispositions represent risk factors that could affect immigrants' mental health.     

How Are Money Worries Affecting Middle-Aged,Young-Old,and Old–Old People’s Perceived Couple Relationship?

While the association between financial strain and couple interaction has been well-established in the literature on economic stress, little research has investigated the association among middle-aged and older populations. The present study examined the relationships between financial strain and couple functioning of middle-aged, young-old, and old–old people using the 2010 Health and Retirement Study. Findings show that subjective financial strain was positively associated with partner undermining and negatively with partner support, controlling for the effects of objective financial situations among middle-aged, young-old, and old–old couples. There were gender and age differences in the interaction effects of financial strain and financial control on couple functioning. For middle-aged men, financial control may have different associations with couple behaviors depending on the level of financial strain. When the level of financial strain is high, the positive effect of financial control disappears and the effect changes even in a negative way. Findings provide suggestions for practitioners and researchers.     

Sources of information and portfolio allocation

This research investigates the relationship between how a household receives financial information and the degree to which investment portfolios are diversified. Diversification is measured as allocation across asset classes and share of assets held in each asset class. Propensity score-based techniques incorporating stratification and weighting are employed to better isolate causal links, while also controlling for objective and subjective financial literacy and overconfidence. Results indicate that the use of financial planners and brokers is associated with an increase in asset class diversification. Households that consult with financial planners and bankers allocate their wealth systematically different from those who do not. These results highlight the role that financial professionals play in helping households make investment decisions.     

Domain specificity of fairness judgments in economic transactions

Two studies eliciting fairness judgments about hypothetical economic transactions examined whether fairness judgments were influenced by who was being judged. The first study replicated the results of Kahneman et al. (Am. Econom. Rev. 76 (1986a) 728–741; J. Business 59 (1986b) S285–S300) that people judge certain actions by firms as unfair, but it also demonstrated that people judge parallel actions by individuals as fair. The second study suggested that people apply different standards to individuals and firms because of presumed differences between them in wealth, power, and size. When firms were portrayed as no more powerful or wealthy than individuals, differences in fairness judgments were eliminated. Further, respondents were less inclined to judge the behavior of a firm harshly as perpetrator of an unfair act when the firm was identified with an individual than when it was large and anonymous, and they were more inclined to judge the behavior of an individual harshly as perpetrator of an unfair act when the action injured a firm with a clearly identified individual than when the firm was large and anonymous.     

Children's subjective well-being in relation to gender — What can we learn from dissatisfied children?

Gender differences in subjective well-being (SWB) are a common finding in studies of children, but the nature, causes and effects of these differences remain unclear. This article draws on data from the Children's Worlds study, an international survey of child well-being across countries, to examine the structure of SWB drawing on different life domains, and comparing the effects of these domains on SWB for boys and girls. Structural equation modelling is used to examine differences between 12 year old boys and girls who reported low subjective well-being (bottom 25% of the sample). Findings reveal that the structure of SWB is comparable across the genders; girls' SWB was lower than boys'; and different domains of SWB vary in their importance for boys and girls. Specifically, girls' SWB appears to be more driven by relational factors, whilst boys' SWB is more driven by perceived academic achievement.