Gender spenders

Study suggests yet another cause of personal debt: searching for the ideal mate.


Many Americans went into personal debt before the economic recession hit the country in 2008. Why? For some men, the biggest factor may have been intense competition to find a spouse.

That’s the suggestion of a new study co-authored by an MIT professor that analyzes the ways social settings can affect people’s propensity to save or spend money. Geographic areas with unusually high ratios of men to women, as the study notes, are correlated with high levels of personal debt; in follow-up lab experiments, the researchers found that men are more willing to spend money quickly in social settings with marked gender imbalances.

“There is reason to believe that men are making financial decisions in a way that reflects the influence of the ratios of men and women,” says Joshua Ackerman, an assistant professor of marketing at the MIT Sloan School of Management and one of the researchers who performed the study. “Seeing more men around them in these environments activates a competitive mindset, which leads to a short-term, spend-now approach.”

Georgia on their minds

The study examined 134 cities across the United States, looking at gender ratios as well as the number of credit cards owned and the amount of consumer debt in each place. In some regions, these things vary widely.

Consider the case of Macon and Columbus, two Georgia cities located within 100 miles of each other. In Columbus, there are 1.18 single men for every single woman, while in Macon, there are 0.78 single men for every single woman. As it happens, the average consumer debt in Columbus is $3,479 higher, per capita, than it is in Macon.

To see if this could be related to gender issues, the researchers then set up a series of three experiments involving 205 people, who were presented with a series of photos on computer screens and asked to make a set of 20 financial choices; in one of the experiments, subjects were asked questions about how much they would be willing to spend on what the study calls “mating-related expenditures,” such as a Valentine’s Day gift, a dinner date and an engagement ring.

When shown images with many more men than women, men in the study were willing to reduce their savings by 42 percent, and were willing to assume 84 percent more debt. “When men see more men than women in these photograph arrays, they become more likely to want to spend money more quickly, even to the point of going into debt,” Ackerman observes.

The results are presented in a new paper, “The Financial Consequences of Too Many Men: Sex Ratio Effects on Saving, Borrowing, and Spending,” appearing in the January issue of the Journal of Personality and Social Psychology.

The lead author of the paper is Vladas Griskevicius of the University of Minnesota’s Carlson School of Management; in addition to Ackerman, other co-authors of the paper are Joshua M. Tybur of the Netherlands’ VU University Amsterdam, Andrew W. Delton and Theresa E. Robertson of the University of California at Santa Barbara, and Andrew E. White of Arizona State University.

A China syndrome?

Douglas Kenrick, a professor of psychology at Arizona State who is familiar with the study, calls it “important” and says that its conclusions “elegantly link to a broad set of findings on humans and other species” involving the effects of mating competition on decision making. “Some of our complicated mental decisions are actually manifestations of simpler, more biologically general processes,” Kenrick suggests.

As Ackerman acknowledges, the study’s results are one piece of a larger puzzle about consumer habits during the credit-fueled spending boom that just ended. “The studies do show in direct ways how [these] ratios can affect people’s decision making, but I don’t think it’s the last chapter in this kind of research,” Ackerman says.

For one thing, people in many types of social circumstances — not just in locations with imbalanced gender ratios — went into debt during the credit-fueled spending boom that preceded the recession, so spending in search of the ideal partner is just one of the reasons people live beyond their means.

Ackerman and his colleagues also say they would like to study cross-cultural spending habits in future research — perhaps in China, which has a significant gender imbalance, but unlike the United States, has traditionally had high savings rates.

“If competition is what’s really underlying this kind of spending, that should be fairly consistent across cultures,” Ackerman says. “But how those decisions get expressed might be much more culturally tinged. In China there’s a stronger norm toward giving gifts to a bride’s family. In that situation, spending money quickly isn’t necessarily going to lead to the best outcome. Instead, saving so that the amount of money you spend is worthwhile would make more sense.”


Topics: Collaboration, Debt, Economics, Finance, Gender, Management, Psychology

Comments

just switch of the Power connection for 9 hours in day in these area, will the picture change?
My feeling is that the women, not as a conspiracy nor in solidarity, but as the aggregate of arbitrary, individual actions, also enforce an economy of scarcity when it comes to being a man's life partner. This has a perhaps unintended consequence of making a competitive environment for men seeking a life partner. I would hardly expect the women to have an interest in this phenomenon; this is the men's problem if they fail to be prudent enough.
Warren Farrell undertook extensive research in the 1980s which showed that men are just as much victims of modern culture as the other half. Turning off the power or telling them that they are foolish will not change a thing while the societal infrastructure of value and worth continue entrenched. The truth does not sell well. By all means, use the knowledge to help yourself and others, but it will never become mainstream; there are just too many powerful people with a vested interest in men continuing to spend more than is wise while they continue to feel inadequate and unaccepted. P.S. By the way, statistics show that there are more women than men on the planet, and in many countries (even with gender specific abortion and infanticides). The clever fellows will pack up their bongos and move from the Columbuses to the Macons, to slant the odds in their favour.
Consider the case of Macon and Columbus, two Georgia cities located within 100 miles of each other. Did you consider that Columbus, GA is home to Ft Benning (a very large Basic Training Army Base), and is thus full of very junior, and somewhat poorly paid Army recruits? Granted Macon, GA does have a military base nearby, but has a sister city (Warner Robins) that is immediately adjacent to it, and closer to the base itself. Finally, Warner Robins AFB is not the site of Air Force basic training, and thus has a more diverse mix of Officer, Senior Enlisted, and Junior Enlisted personnel.
"In Columbus, there are 1.18 single men for every single woman, while in Macon, there are 0.78 single men for every single woman. As it happens, the average consumer debt in Columbus is $3,479 higher, per capita, than it is in Macon." When you say average consumer debt, do you mean average MALE consumer debt? If not, you're ignoring a more straightforward explanation of the data: If geographical areas with more women have less debt per consumer, perhaps female consumers are just more prudent with money than their male counterparts.
As a male, I go on a date and I pay, not her! I buy her presents so she will marry me. I get married and my wife spends most of the money. We have kids and my wife picks the most expensive school. My jewelry budget every year is nil, hers is in four or five figures. Her Christmas gift was $3,000, mine was $300. We bought the house she picked out. We vacation where she chose. Are you getting the pattern? We men spend our money on women because 'that's what we do.' When the women are 'happy' we are happy. If you are in area where you have to try harder, you try harder! If there are no women, we save money. Men and women are different and get over it. I hope my tax dollars didn't pay for this study.
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