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Behavioral Economics
Want to Show off Your Wealth and Status? Buy a Hybrid!
Going green to be seen.
Posted February 15, 2010
What can you do if you want to engage in conspicuous consumption right alongside Cameron Diaz, Leonardo DiCaprio, Ed Begley Jr., Woody Harrelson, David Duchovny, Jackson Browne, Bill Maher, Patricia Arquette, Rob Reiner, and Seinfeld director Larry David?
Ummm...buy a hybrid car?
You might not think of a compact little automobile with a small trunk and a frugal gas-sipping engine as the ultimate act of conspicuous consumption. Wouldn't it show off your status more effectively to buy a gas-guzzling Porsche or a big expensive SUV? Not according to research by Vladas Griskevicius, Josh Tybur, and Bram Van den Bergh.
In 3 experiments to appear in next month's issue of the Journal of Personality and Social Psychology, titled "Going Green to Be Seen," Griskevicius and his colleagues explored the evolutionary psychology of status and environmentalism.
In their first experiment, the researchers asked participants to imagine they were out shopping for a car, a household cleaner, and a dishwasher. For each of the three products, people were asked to choose between the more luxurious nongreen option and an equivalently priced, but less high-performing, green option. For example, they chose between two versions of the Honda Accord, both costing $30,000 - one was a hybrid with less luxury, power, and comfort, the other was a high performance feature-rich EX-L model with a sporty V6 engine.
Before making their choice, some of the subjects had been primed to think about status by imagining they'd just arrived for their first day at a high-powered job, where they'd been immediately impressed by the upscale lobby and well-appointed offices. When they meet their new boss, he introduces them to two other new employees. He informs them that there was a lot of competition for this job, and that in a year, one of them would move up into a fancy office, but one of them would likely be out looking for a new job. In the control conditions, participants either read no story or imagined they'd been searching their house for a lost concert ticket, which they found just before they had to leave.
The results (shown in Figure 1) were that thinking about status led people to be more eager to purchase environmentally friendly products. Why? The authors explained the results in terms of a combination of ideas from "costly signaling theory" and "competitive altruism." Costly signaling theory posits that people (and other organisms—such as peacocks and mockingbirds) often show off by displaying their ability to waste energy and resources. Competitive altruism theory is a related idea—that conspicuous displays of altruism often function to build reputations, which makes people more desirable as group members.
In support of the idea that green consumption can be a form of signaling, a second study found that people thinking about status do not purchase green products when no one else is going to know about it. When purchasing light bulbs over the internet, for example, they selfishly choose the better features of the nongreen option; when other people will know about their decisions, they go green.
A third study resolved another interesting dilemma. Earlier research by Ed Sadalla and Jennifer Krull had suggested that people sometimes assume that conservation behaviors (such as recycling or taking public transportation) signal a lack of resources. The Sadalla & Krull research was conducted 15 years ago, before it was quite so cool to be seen as green, but Griskevicius and his colleagues used those findings to uncover another fascinating aspect of going green to be seen. Their last study demonstrated that people thinking about status did not prefer a green product if it was less expensive. That is, status motives led people to make a rather economically irrational decision, at least from a superficial perspective. When people are thinking about status, they in fact want to spend more—to demonstrate not only that they are environmentally conscious, but also that they can afford to be environmentally conscious.
That last finding might explain two economically unexpected events in recent years. When tax credits for Prius expired in late 2006, economic experts expected to see sales tank. But they did not, in fact they went up a whopping 79%. And it might also explain another event that bewildered the experts: When Lexus introduced a new sedan that cost over $100,000, it seemed somewhat irrational to power it with a penny-pinching hybrid engine. Yet Lexus was unable to keep up with the demand for the conspicuously environmental Lexus LS600h, which exceeded sales projections by 300%.
So, if you want to keep up with the DiCaprios and Diazes, buy a hybrid car, but don't park it in your garage, park it conspicuously in front of your house (where ideally it will reflect light from the fancy solar panel shining from the front and center of your roof).
References
Griskevicius, V., Tybur, J.M., & Van den Bergh, B. (2010). Going green to be seen: Status, reputation, and conspicuous conservation. Journal of Personality and Social Psychology, 98, in press.
Griskevicius, V., Tybur, J. M., Sundie, J. M., Cialdini, R. B., Miller, G. F., & Kenrick, D. T. (2007). Blatant benevolence and conspicuous consumption: When romantic motives elicit strategic costly signals. Journal of Personality and Social Psychology, 93, 85-102.
Sadalla, E. K., & Krull, J. L. (1995). Self-presentational barriers to resource conservation. Environment and Behavior, 27, 328–353.
Van Vugt, M., Roberts, G., & Hardy, C. (2007). Competitive altruism: Development of reputation-based cooperation in groups. In R. Dunbar & L. Barrett (Eds.), Handbook of evolutionary psychology (pp. 531-540). Oxford, England: Oxford University Press
