Published: Nov. 10, 2020

Assistant Professor Joe Gladstone and co-authors Dr. Heather Kappes of the London School of Economics and Dr. Hal Hershfield of UCLA’s Anderson School of Business recently had their new paper "Beliefs About Whether Spending Implies Wealth," accepted by the Journal of Consumer Research.

According to the authors, the study will help “contribute to a deeper understanding of how underlying beliefs about the meaning of spending relate to financial well-being.”

Read the abstract below or the full paper here.


Spending money might imply that someone is relatively wealthy—since they have money to spend, or relatively poor—since spending can deplete assets. We show that people differ in the extent to which they believe that spending implies wealth (SIW beliefs). We develop a scale to measure these beliefs and find that people who more strongly believe that spending implies wealth spend their own money relatively lavishly and are, on average, more financially vulnerable. We find correlational evidence for these relationships using self-reported financial well-being and objective financial-transaction data. We also find experimental evidence by manipulating SIW beliefs and observing causal effects on spending intentions. These results show how underlying beliefs about the link between spending and wealth play a role in consumption decisions, and point to beliefs about the meaning of spending as a fruitful direction for further research.