I tend to agree with this notion…(enjoy!)
Introduction (via Ted)
After hitting on a brilliant new life plan, our first instinct is to tell someone, but Derek Sivers says it’s better to keep goals secret. He presents research stretching as far back as the 1920s to show why people who talk about their ambitions may be less likely to achieve them.
Brilliant
Abstract (via Leslie K. John, Alessandro Acquisti, and George Loewenstein)
New marketing paradigms that exploit the capabilities for data collection, aggregation, and dissemination introduced by the Internet provide benefits to consumers but also pose real or perceived privacy hazards. In four experiments, we seek to understand consumer decisions to reveal or withhold information and the relationship between such decisions and objective hazards posed by information revelation. Our central thesis, and a central finding of all four experiments, is that disclosure of private information is responsive to environmental cues that bear little connection, or are even inversely related, to objective hazards. We address underlying processes and rule out alternative explanations by eliciting subjective judgments of the sensitivity of inquiries (experiment 3) and by showing that the effect of cues diminishes if privacy concern is activated at the outset of the experiment (experiment 4). This research highlights consumer vulnerabilities in navigating increasingly complex privacy issues introduced by new information technologies.
Click Here To Read: When Are We Most Likely to Divulge Secrets! Think Strangers On A Plane
Abstract (via Eminegul Karababa and Guliz Ger)
We examine the sociohistorical formation of the consumer subject during the development of consumer culture in the context of leisure consumption. Specifically, we investigate how an active consumer was forming while a coffeehouse culture was taking shape during early modern Ottoman society. Utilizing multiple historical data sources and analysis techniques, we focus on the discursive negotiations and the practices of the consumers, the marketers, the state, and the religious institution as relevant stakeholders. Our findings demonstrate that multiparty resistance, enacted by consumers and marketers, first challenged the authority of the state and religion and then changed them. Simultaneously and at interplay with various institutional transformations, a public sphere, a coffeehouse culture, and a consumer subject constructing his self-ethics were developed, normalized, and legalized. We discuss the implications of the centrality of transgressive hedonism in this process, as well as the existence of an active consumer in an early modern context.
Click Here To Read: Early Modern Ottoman Coffeehouse Culture and the Formation of the Consumer
I’m tempted to say…I knew it all along but here’s the research.
Abstract (via Serra, Serneels, Barr)
Economists have traditionally assumed that individual behavior is motivated exclusively by extrinsic incentives. Social psychologists, in contrast, stress that intrinsic motivations are also important. In recent work, economic theorists have started to build psychological factors, like intrinsic motivations, into their models. Besley and Ghatak (2005) propose that individuals are differently motivated in that they have different “missions,” and their self-selection into sectors or organizations with matching missions enhances organizational efficiency. We test Besley and Ghatak’s model using data from a unique cohort study. We generate two proxies for intrinsic motivations: a survey-based measure of the health professionals philanthropic motivations and an experimental measure of their pro-social motivations. We find that both proxies predict health professionals’ decision to work in the non-profit sector. We also find that philanthropic health workers employed in the non-profit sector earn lower wages than their colleagues.
Click Here To Read: Intrinsic Motivation Leads Health Professionals to Work in Non Profits
Excerpts (Via PhysOrg)
As any nine-to-fiver will testify, a new paycheck brings with it a familiar sense of freedom, albeit one that dwindles in lockstep with the balance in one’s checking account. But, it’s not the checking account size that influences consumer behavior; rather, it’s the time that has elapsed since payday, according to a new study published in the September issue of the Journal of Marketing.
Payday proximity means more than awareness of the amount of money in the bank and product prices. It actually changes consumer motives, response to messages and purchase behavior, report University of Utah marketing professors Himanshu and Arul Mishra.
The researchers found that the proportion of “aspired” products declined and the proportion of “ought” products increased as the participants got further away from their paychecks. The team also demonstrated that these results were not related to declining checking account balances during the month or to product prices.
Click Here To Read: Approaching Paydays Change Our Behavior & Motivation!!!
Excerpt (via Phys Org)
“The results suggest that economic migrants might well experience disappointment. Migrants do gain happiness from higher incomes, to a greater extent than natives – but the relationship is weak even for migrants. In fact, it also works out that migrants are less happy than natives. The probable reason is that they expect to be happier by virtue of earning the greater incomes available in a wealthy country – but they end up wanting even more after they get there: aspirations probably increase at least as much as incomes.
“In short, even after an increase migrants find it difficult to feel satisfied with their incomes – just like the rest of us.
“Many of us are guilty of believing that money is more important for happiness than it is – and this research suggests that migrants are not terribly different in this regard. Life as an immigrant in a wealthy country can be very hard.”
Click Here To Read: The Grass Is Not Always Greener: migration may not bring happiness
Via PhysOrg
When given a choice, older people prefer to read negative news, rather than positive news, about young adults, a new study suggests.
In fact, older readers who chose to read negative stories about young individuals actually get a small boost in their self-esteem, according to the results.
And what about younger people? Well, they just prefer not to read about older people.
Click Here To Read: Over 50? You probably prefer negative stories about young people
Recommended Excerpts (via Jonah Lehrer @ Wired)
The miners have already survived underground longer than anyone else – they broke the 25 day record today – and will mostly like remain underground for at least another few months.
But this post is not about the miners, and their Dantesque plight. Instead, it’s about our reaction to them, and the extraordinary outpouring of emotion that occurs whenever we can latch onto a set of identifiable victims.
Of course, this is a deeply irrational reaction. We are much less interested in helping a victim – we only want to help the victim. (This bias is known as the identifiable victim effect, since it suggests that we react much more strongly when the victim can be specified.) Why do we this? Because human charity is ultimately rooted in our compassionate feelings, and not in some rational, utilitarian calculations. We are not Vulcans.
What’s interesting, though, is that some people are much less vulnerable to the identifiable victim effect than others. (There are Spocks among us!) Consider this new paper led by James Friedrich, at Willamette University, which measured differences in “analytic processing” style among 120 undergraduates. (The test for this is a rather straightforward survey, which includes questions such as “I enjoy intellectual challenges” and “I believe in trusting my hunches”.) Not surprisingly, people who tend toward analysis were also less likely to display the identifiable victim bias:
Click Here To Read: Jonah Lehrer on The Identifiable Victim Bias & Chilean Miners
H/T Leadon Young
Introduction (via Kissmetrics)
For retailers, shopping is the art of persuasion. Though there are many factors that influence how and what consumers buy. However, a great deal is decided by visual cues, the strongest and most persuasive being color. When marketing new products it is crucial to consider that consumers place visual appearance and color above other factors such as sound, smell and texture. To learn more about color psychology and how it influences purchases, see our latest infographic.
*Image via Kissmetrics
The latest via the St.Louis Fed
Abstract (Via James Bullard)
In this paper the author discusses the possibility that the U.S. economy may become enmeshed in a Japanese-style deflationary outcome within the next several years. To frame the discussion, the author relies on an analysis that emphasizes two possible long-run steady states for the economy: one that is consistent with monetary policy as it has typically been implemented in the United States in recent years and one that is consistent with the low nominal interest rate, deflationary regime observed in Japan during the same period. The data considered seem to be quite consistent with the two steady-state possibilities. The author describes and critiques seven stories that are told in monetary policy circles regarding this analysis and emphasizes two main conclusions: (i) The Federal Open Market Committee’s “extended period” language may be increasing the probability of a Japanese-style outcome for the United States and (ii), on balance, the U.S. quantitative easing program offers the best tool to avoid such an outcome.
Additional Excerpts (Via James Bullard):
Seven Faces Of Peril
1. Denial
I think it is fair to say that, for many who have been involved in central banking over the past two or three decades, it is difficult to think of Japan and the United States in the same game, as Figure 1 suggests. For many, the situation in Japan since the 1990s has been a curiosum, an odd outcome that might be chalked up to particularly Byzantine Japanese politics, the lack of an inflation target for the Bank of Japan (BOJ), a certain lack of political independence for the BOJ, or some other factor specific to the Land of the Rising Sun. The idea that U.S. policymakers should worry about the nonlinearity of the Taylor-type rule and its implications is sometimes viewed as an amusing bit of theory without real ramifications.
2. Stability
There is another version of the denial view that is somewhat less extreme but nevertheless still a form of denial in the end. It is a view that I have been associated with in my own research. In this view, one accepts the zero bound on nominal interest rates and the other details of the analysis by Benhabib, Schmitt-Grohé, and Uribe. One accepts that there are two steady states. How – ever, the steady states have stability properties associated with them in a fully dynamic analysis, and the argument is that the targeted steady state is the stable one, while the unintended, low nominal interest rate steady state is unstable. Therefore, according to this argument, one should expect to observe the economy in the neighborhood of the targeted steady state and need not worry about the unintended, low nominal interest rate steady state.
3. The FOMC in 2003
In Figure 1, a set of data points is circled. These data are labeled “2003-2004” and are associated with a policy rate at 1.0 percent and the inflation rate between 1.0 and 1.5 percent. This episode was the last time the FOMC worried about a possible bout of deflation. While core inflation did move to a low level during this period—not quite as low as the current level—inflation moved higher later and interest rates were increased. This episode surely provides comfort for those who think the Japanese-style outcome is unlikely. It suggests that the economy will ultimately return to the neighborhood of the targeted steady state, perhaps even indicating that the stability story is the right one after all. The 2003 experience did not involve a near-zero policy rate, however.
4. Discontinuity
If the problem is the existence of a second, unintended steady state—and this is partly caused
by the choice of a policy rule that is controlled by policymakers—why not just choose a different policy rule? This can, in fact, be done and was discussed by Benhabib, Schmitt-Grohé, and Uribe in their original paper. Furthermore, some parts of the current policy discussion have exactly this flavor.….Of course, this policy looks unusual and perhaps few would advocate it, but again we are trying to avoid all those circles down there in the southwest portion of the diagram. The discontinuouspolicy has the great advantage that it is a very simple way to ensure that the unintended, low nominal interest rate steady state no longer exists. The only point in the diagram where the Fisher relation and the policy rule can be in harmony is the targeted equilibrium. This would remove the unintended steady state as a focal point for the economy.
5. Traditional Policy
According to the Bank of England,15 for 314 years the policy rate was never allowed to fall below 2.0 percent. During more than three centuries the economy was subject to large shocks, wars, financial crises, and the Great Depression— yet 2.0 percent was the policy rate floor until very recently. A version of this policy is displayed in Figure 5. This policy rule does not eliminate the unintended steady state; it simply moves it to be associated with a higher level of inflation. In the figure, this point occurs at an interest rate of 2.0 percent and an inflation rate of 1.5 percent (the center arrow in the figure). This policy seems very reasonable in some ways. To the extent that one of the main purposes of the interest rate policy is to keep inflation low and stable, this policy creates two steady states, but the policymaker may be more or less indifferent between the two outcomes. Then one has to worry much less about the possibility of becoming permanently trapped in an unintended, deflationary steady state. This policy prevents the onset of interest rates that are “too low.”
6. Fiscal Intervention Given the Situation in Europe
In the academic literature following the 2001 publication of the perils paper, some attempt was made to provide policy advice on how to avoid the unintended steady state of Figure 1.17 This advice was given in the context of trying to preserve the desirable qualities of the Taylor-type interest rate rule in the neighborhood of the targeted steady state. That is, even though interest rate rules are the problem here, the advice is given in the context of those rules—as opposed to simply abandoning them altogether.7. Quantitative Easing
The quantitative easing policy undertaken by the FOMC in 2009 has generally been regarded as successful in the sense that longer-term interest rates fell following the announcement and implementation of the program.20 Similar assessments apply to the Bank of England’s quantitative easing policy. For the United Kingdom in particular, both expected inflation and actual inflation have remained higher to date, and for that reason the United Kingdom seems less threatened by a deflationary trap. The U.K. quantitative easing program has a more state-contingent character for rates to bottom out at a level somewhat higher than zero, as the traditional policy rule does. Of course, a policy rule like the one depicted in Figure 5 does not allow as much policy accommodation in the face of shocks to the economy at the margin. But is it worth risking a “lost decade” to get the extra bit of accommodation?
Click Here To Read: Japan in the US? Seven Faces of “The Peril”
