Prosocial Spending and Well-Being

by

Lara B. Aknin, Kate Hanniball

• LAST REVIEWED: 27 June 2017
• LAST MODIFIED: 27 June 2017
• DOI: 10.1093/obo/9780199828340-0193

Introduction

In a typical week, a person may spend money on other people in various ways. For instance, one might buy a cup of coffee for a colleague, treat an old friend to dinner, donate to a charity online, or give money to a homeless person they pass on the street. Using one’s money to benefit others as opposed to spending on oneself has been labeled prosocial spending and reflects one of the many ways that people can use their personal resources to help others (e.g., donating their time or skill). Although investigation into this topic is relatively new, a growing body of research utilizing both correlational and experimental studies suggests that prosocial spending promotes happiness. This work marks a departure from past research on the relationship between money and well-being in several ways. First, rather than examining the link between personal income and self-reported happiness, researchers examining prosocial spending ask whether specific spending choices—mainly spending money on others as opposed to oneself—can increase happiness. Second, in contrast to past work demonstrating that having more money or being exposed to reminders of money can reduce helpful behavior, research on prosocial spending explores how money can be used in service of others. Researchers are now exploring the boundary conditions, applications, and extensions of prosocial spending, providing insight into the various antecedents and consequences of financial generosity. This bibliography is organized into six sections. General Overviews on Prosocial Spending and Well-Being contains an early economics paper outlining this possibility, initial research demonstrating prosocial spending’s causal impact on happiness, as well as two papers demonstrating this effect in various countries around the world. Potential Mediators and Moderators summarizes some of the factors that do (and do not) influence when and how prosocial spending promotes happiness. Intuitions directs readers to papers probing whether people recognize and anticipate the emotional benefits of prosocial spending, and one factor that makes this more likely. Health and Performance Outcomes summarizes research suggesting that prosocial spending may have positive health as well as physical and mental strength consequences. Predictors of Financial Generosity (Prosocial Spending) lists several variables shown to increase and inhibit spending money on others. Finally Extensions presents several applications of prosocial spending research.

General Overviews on Prosocial Spending and Well-Being

Early economic models of charitable behavior, such as the “impure altruism” theory proposed in Andreoni 1990, suggest that individuals may be partially motivated to help others because of the emotional benefits or “warm glow” of giving. Consistent with this notion, the first paper to examine whether prosocial spending leads to greater well-being than spending money on oneself was Dunn, et al. 2008. Here authors provided causal evidence of the relationship between generous spending and well-being by demonstrating that individuals randomly assigned to spend money on someone else reported greater positive affect at the end of the day than participants randomly assigned to spend money on themselves. Since this initial work, Aknin and colleagues have examined the generalizability of this finding in various countries around the world; the two remaining papers, Aknin, et al. 2013 and Aknin, et al. 2015, build upon initial work by replicating findings in geographically and economically diverse cultures such as Canada, Uganda, India, and Vanuatu.

• Aknin, L. B., C. P. Barrington-Leigh, E. W. Dunn, et al. 2013. Prosocial spending and well-being: Cross-cultural evidence for a psychological universal. Journal of Personality and Social Psychology 104.4: 635–652.

  DOI: 10.1037/a0031578

  In this paper, Aknin and colleagues argue that the emotional benefits of prosocial spending represent a psychological universal, detectable in most countries and cultures around the world. To support this claim, the authors present correlational and experimental evidence demonstrating that prosocial spending is associated with happiness in rich and poor countries.

• Aknin, L. B., T. Broesch, J. K. Hamlin, and J. Van de Vondervoot. 2015. Prosocial behavior leads to happiness in a small-scale rural society. Journal of Experimental Psychology-General 144.4: 788–795.

  DOI: 10.1037/xge0000082

  Findings demonstrate that the emotional benefits of generous spending and generous behavior are detectable in adults and kids from a small-scale rural society.

• Andreoni, J. 1990. Impure altruism and donations to public goods: A theory of warm-glow giving. The Economic Journal 100.401: 464–477.

  DOI: 10.2307/2234133

  This paper outlines a theoretical model of charitable giving wherein individuals are not solely motivated to give to public goods and charities out of a desire to increase the welfare of others, but are also motivated by the potential of experiencing positive feelings or a “warm glow.”

• Dunn, E. W., L. B. Aknin, and M. I. Norton. 2008. Spending money on others promotes happiness. Science 319.5870: 1687–1688.

  DOI: 10.1126/science.1150952

  The first paper to investigate whether prosocial spending leads to greater happiness than spending money on oneself. Findings demonstrate that individuals randomly assigned to spend money on others report greater happiness than those who spent money on themselves.