Dollars and Sense

defined. We often imagine our future selves to be entirely different people than our present selves.

They didn’t have to count out bills, per se, but they had to weigh the costs and benefits, charge the bill to their room, contemplate a tip, and so on. Even small items incurred an associated payment, and therefore an associated pain.

36-inch Panasonic for $690, a 42-inch Toshiba for $850, and a 50-inch Philips for $1,480. Faced with these choices, most people choose the middle option, the $850 Toshiba. The cheapest and most expensive items are road signs funneling us to the middle option. In this case, relativity doesn’t compel us to compare one specific product to another; rat

The language tells us a story. Then, listening to the description from open to pour, from tipped glass to inhaling the “nose,” from swallow to aftertaste, we join the wine’s story. That enhances and transforms how much we value the wine and our drinking experience.

The trick to this type of market competition (and the key to Dan’s game) is either never to play in the first place or, if we play, to learn quickly when things are not going our way and cut our losses.

And, most important, when the payment is extra salient, we dramatically change our spending patterns. In short, because of the pain of paying, we’re willing to pay more before, less after, and even less during consumption of the very same product. The timing of payment truly matters.

Money represents VALUE. Money itself has no value. It only represents the value of other things that we can get with it. It’s a messenger of worth.

It is not objective effort so much as the appearance of effort that drives the psychology of what we are willing to pay.

This tells us that having the money in an account dedicated to a particular activity influenced our participants to spend more. Fifty percent more, in this case.