Plenty of previous studies, including one I reported on here in Second Opinion, have suggested that spending money on experiences (vacations, dining out, live concerts) rather than on possessions (clothes, tech gadgets, jewelry) tends to make people happier.
This psychological phenomenon is known as the experiential advantage.
A study published earlier this year in the journal Psychological Science has added some important nuance to those earlier findings, however. It reported that social class — particularly access to financial resources — is a major factor in whether people are happier buying experiences rather than stuff.
Although wealthier people do tend to be happier when their money goes toward experiences, lower-income people tend to receive more pleasure from making material purchases, the study found.The reason for that divergence, say the study’s authors, is because people with more resources can afford to spend money on self-development and self-expression, while those with fewer resources are more likely to be concerned about making financially wise purchases.
“For lower-class consumers, spending money on concert tickets or a weekend trip might not result in greater happiness than buying a new pair of shoes or a flatscreen TV,” explains Deborah Hall, one of the study’s authors and a social and behavioral scientist at Arizona State University, in a released statement. “In fact, in some of our studies, lower class consumers were happiest from purchasing things, which makes sense given that material goods have practical benefit, resale value, and are physically longer lasting.”
A series of experiments
As an initial test of whether social class plays a role in the experiential advantage, Hall and her colleagues conducted a meta-analysis of 23 studies that had examined the experiential advantage among college students at seven private and public institutions. Students at private colleges come from wealthier families, on average, than their peers at public institutions.
The meta-analysis revealed that students at private colleges were more likely to report greater happiness from purchasing experiences than those at public institutions.
The researchers then conducted an experiment involving 200 U.S. adults, who were recruited through Amazon’s Mechanical Turk survey website. The participants were asked to recall a recent purchase of both an experience and an object and then rate each in terms of the happiness it gave them. They were also asked to report their social class using a ladder-like scale from 1 (highest social class) to 10 (lowest).
As predicted from the meta-analysis, the participants who placed themselves on a higher “rung” of the ladder in terms of social class reported more happiness from spending money on experiences, while those who identified as coming from a lower social class indicated that the purchase of materials goods made them happier.
Experiment No. 2
In a second experiment, 500 participants were randomly asked to recall either a recent experiential or material purchase. They were then asked to indicate — on a scale from 1 (not at all) to 7 (very much) — how happy their memory of the purchase makes them feel.
This experiment used household income and educational level as the determinants of social class. People with an annual household income greater than $80,000 and at least a bachelor’s degree were defined as “higher class,” while those with an annual household income of less than $30,000 and a high school degree or less were defined as “lower class.”
As in the first experiment, participants in the higher social class were more likely to say that experiences brought them greater happiness than those in the lower class.
Experiment No. 3
In a third experiment, the researchers manipulated people’s feelings of affluence to see how social class might influence the happiness effects of different types of purchases. They asked 402 participants to imagine that their income had either decreased or increased by 50 percent. The participants were given some tasks (such as creating a new monthly budget) to help make that income change seem more real.Those who imagined having their income cut in half reported similar levels of happiness from recent experiential and material purchases they had made. Those who imagined that their monthly income had risen by 50 percent, however, reported that the purchase of experiences gave them greater happiness.
“These results demonstrate the causal role of resource availability in guiding purchase happiness and are particularly compelling given that the manipulation of resource availability was completed after participants recalled their initial purchases,” Hall and her colleagues write.
‘No single answer’
These experiments come with important caveats. Most notably, they relied on the memory of the participants regarding how purchases had made them feel. Also, the participants were primarily recruited through an online website and may not, therefore, represent broader groups of people.
Still, the findings are compelling — both for what they say about the influence of social class on the experiential advantage and for what they say about the shortfalls of psychological studies that don’t include participants from various socioeconomic groups.
“Emerging research on the psychology of social class illustrates the limitations of focusing on high-class individuals and neglecting the perspective of lower-class individuals, who make up a significant portion of the U.S. population,” write Hall and her colleagues. “Thus, the popular recommendation for experiential purchases might lead lower-class individuals away from the happiness they could achieve from material goods.”
“There appears to be no single answer to the question of whether to spend on experiential or material purchases for the most happiness,” they add. “Although our society tends to praise the pursuit of experiences and criticize the pursuit of material goods, the pursuit of material goods should not be overlooked as a route to happiness for those who currently possess very little.”
FMI: You’ll find an abstract of the study on the Psychological Science website, but the full study is behind a paywall.