Is There A Link Between Cashless Payments And Unhealthy Consumption? by University of Chicago via Natural Blaze
The widespread use of cashless payments including credit cards, debit cards, and mobile apps has made transactions more convenient for consumers. However, results from previous research have shown that such cashless payments can increase consumers’ spending on unhealthy food. “Why Do Cashless Payments Increase Unhealthy Consumption? The Decision-Risk Inattention Hypothesis,” a newly published article in the Journal of the Association for Consumer Research, explains this phenomenon by showing how changes in bodily responses to cashless payments influence consumers responses.
Authors Joowon Park, Clarence Lee, and Manoj Thomas propose that cash and cashless payments elicit different levels of negative arousal when making shopping decisions. “Most people experience a spontaneous negative emotional response to the loss of wealth, particularly when such loss is concrete and vivid,” the authors note. In contrast, when a person swipes a card or uses mobile payment, it is difficult to visualize the money changing hands. The payment occurs at a later date, which presumably does not entail a physical handover of money. “Because such transactions are not concrete,” the authors write, “cashless payments are less likely to elicit the negative arousal that is appraised as the ‘pain of paying.’”
Since arousal has been shown to direct people’s attention to risky factors in the environment, the authors suggest that the lower level of arousal caused by cashless payments can direct consumers’ attention away from decision risks. This makes shoppers less attentive, for example, to risks relating to food (e.g., the risk that the product might have adverse effects on health in the long run). Authors refer to this process as “decision risk inattention” caused by cashless payments.
Now is your chance to support Gospel News Network.
We love helping others and believe that’s one of the reasons we are chosen as Ambassadors of the Kingdom, to serve God’s children. We look to the Greatest Commandment as our Powering force.
To test this idea, the authors invited participants to a lab for a simulated grocery shopping where some participants were told to imagine making cash payments and others were told to imagine making cashless payments. During the shopping simulation, participants wore a device on their hands that measured changes in their physical arousal level. The authors found that participants thinking of making cashless payments experienced lower arousal than those thinking of making cash payments. The higher arousal from cash payments made participants pay attention to the health risks associated with the grocery items, and consequently less likely to add unhealthy items such as cookies and candies to their shopping baskets. On the other hand, the lower arousal from cashless payments made participants pay less attention to the health risks, and thus they were more likely to purchase unhealthy items. That is, cashless payments made participants pay less attention to decision risks. The changes in arousal did not affect the purchase decision of healthy food items such as apples and salad, the purchase of which does not accompany such decision risks.
