Many people fail to save what they need to for retirement. Research on under-saving suggests that removing the lure of immediate rewards by pre-committing to decisions, or elaborating the value of future rewards can both make decisions more future-oriented. In this article, we explore a third and complementary route, one that deals not with present and future rewards, but with present and future selves.
In line with thinkers who have suggested that people may fail, through a lack of belief or imagination, to identify with their future selves, the authors propose that allowing people to interact with age-progressed renderings of themselves will cause them to allocate more resources toward the future. Across a series of experiments, participants interacted with realistic computer renderings of their future selves using immersive virtual reality hardware and interactive decision aids. In all cases, those who interacted with virtual versions of their future selves exhibited an increased tendency to accept later monetary rewards over immediate ones. These results offer compelling insights for marketers: Providing consumers with vivid, realistic images of their future selves may be one way to encourage saving behavior.
Hal E. Hershfield is an Assistant Professor of Marketing at New York University’s Stern School of Business. His primary research interests include consumer financial decision-making and behavioral economics. He studies the ways that focusing on time can alter emotional experience and decision making. His research has appeared in journals such as Psychological Science and the Journal of Personality and Social Psychology. He earned his B.A. from Tufts University, Ph.D. at Stanford University, and prior to NYU, was a Post-Doctoral Fellow at the Kellogg School of Management at Northwestern University.
Daniel G. Goldstein is Principal Research Scientist at Yahoo Research. His areas of expertise and research include decision-making, behavioral economics, and computational methods. His publications span journals from Science to Psychological Review to the Journal of Consumer Research. He received his Ph.D. at The University of Chicago and has worked as a professor or research scientist at London Business School, Columbia University and The Max Planck Institute in Germany, where he was awarded the Otto Hahn Medal in 1997.
William F. Sharpe is the STANCO 25 Professor of Finance, Emeritus at Stanford University Graduate School of Business. He was one of the originators of the Capital Asset Pricing Model and developed the Sharpe Ratio for investment performance analysis. Dr. Sharpe is past President of the American Finance Association. Dr. Shapre has published articles in a number of professional journals, including Management Science, The Journal of Business, The Journal of Finance, and the Journal of Consumer Research. In 1990, he received the Nobel Prize in Economic Sciences. He received his PhD., M.A., and B.A. in Economics from the University of California at Los Angeles. He is also the recipient of a Doctor of Human Letters, Honoris Causa from DePaul University, a Doctor Honoris Causa from the University of Alicante (Spain), a Doctor Honoris Causa from the University of Vienna (Austria), a Doctor of Science, Economics, Honoris Causa from the London Business School and the UCLA Medal, UCLA’s highest honor.
Jesse Fox (B.A., University of Kentucky; M.A., University of Arizona; Ph.D., Stanford University) is an Assistant Professor in the School of Communication at The Ohio State University. Her primary research interest is mediated interpersonal communication, including virtual representations (i.e., avatars and agents) and social networking sites. Her foci include health communication and sex, gender, and sexuality. Her research has appeared in journals including Media Psychology, Sex Roles, and Presence: Teleoperators and Virtual Environments.
Leo Yeykelis is a Ph.D. student in the Department of Communication at Stanford University studying human computer interaction. Yeykelis has a B.A. in Economics from Stanford University.
Jeremy Bailenson is founding director of Stanford’s Virtual Human Interaction Lab and an Associate Professor in the Department of Communication. He is the coauthor of Infinite Reality: Avatars, Eternal Life, New Worlds, and the Dawn of the Virtual Revolution. He earned a B.A. cum laude from the Michigan in 1994 and a Ph.D. in cognitive psychology from Northwestern in 1999. Bailenson's main area of interest is the phenomenon of digital human representation. His findings have been published in over 70 academic papers in the fields of communication, computer science, education, law, marketing, political science, and psychology. His work has been consistently funded by the NSF for over a decade, and he also receives grants from various Silicon Valley and international corporations. Bailenson consults regularly for government agencies including the Army, the Department of Defense, the National Research Council, and the National Institute of Health on policy issues surrounding virtual reality.
Laura L. Carstensen (B.S., University of Rochester; Ph.D., West Virginia University) is Professor of Psychology and the Fairleigh S. Dickinson, Jr., Professor in Public Policy at Stanford University, where she is also founding director of the Stanford Center on Longevity. For more than twenty years her research has been supported by the National Institute on Aging; in 2005 she received a MERIT award extending this support another decade. Carstensen is best known for socioemotional selectivity theory, a lifespan theory of motivation. Her recent research focuses on how motivational changes influence cognitive processing. Carstensen is a fellow in several professional organizations including the American Psychological Society and the American Psychological Association. Her honors include Stanford University's Dean’s Award for Distinguished Teaching and the Richard Kalish Award for Innovative Research. In 2003, she was selected as a Guggenheim Fellow. Currently, she is a member of the MacArthur Foundation network on Aging Societies.
Journal of Marketing Research, Volume 48, Special Issue 2011
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