The association between experiential and material expenditures and subjective well-being: New evidence from Hungarian survey data

Tamás Hajdu and Gábor Hajdu

Journal of Economic Psychology, 2017, vol. 62, issue C, 72-86

Abstract: In the last decade, a number of studies using experimental designs have stated that spending money on experiences rather than on material goods tends to make people happier. In this research we used a novel survey approach to examine the relationships between experiential and material expenditures and life satisfaction. In two studies based on cross-sectional survey data from nationally representative samples in Hungary, we estimated linear and non-linear models. We found no significant evidence supporting the greater return received when buying experiences. Even in the non-linear models the difference between the marginal utilities was not statistically significant at any expenditure rate, although the marginal utility of experiential purchases appeared to be linear, whereas the marginal utility of material purchases was rather decreasing. Nevertheless, our results suggest that a reallocation of an average person’s expenditures (spending more on experiences and less on material goods) might be associated with a slightly higher well-being.

Keywords: Subjective well-being; Consumption; Experiential purchase; Material purchase; Survey data (search for similar items in EconPapers)
JEL-codes: D12 I31 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Working Paper: The association between experiential and material expenditures and subjective well-being: New evidence from Hungarian survey data (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:joepsy:v:62:y:2017:i:c:p:72-86

DOI: 10.1016/j.joep.2017.06.009

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