Essays on Enhancing Consumer Welfare

Abstract

My dissertation is composed of three papers on the topic of improving consumer welfare—that is, designing psychologically informed interventions to help consumers make decisions that can improve their financial wellbeing and enhance their interpersonal relationships with others and with firms. The first paper (“Repayment-by-Purchase” Helps Consumers to Reduce Credit Card Debt) introduces an intervention that allows consumers to make payments toward specific purchases on a credit card bill (repayment-by-purchase), which leads consumers to become more aware of the purchases they are “paying off” and to pay significantly more toward debt relative to making a payment toward the total balance (typical repayment). The second paper (Voting for Charity and Consumer-Firm Relationships) examines the impact of allowing customers to vote for the charitable recipient of firm donations. The invitation to vote for charity increases consumer attachment to the firm, leading to more spending in the store. The third paper (Communicating Resource Scarcity) evaluates how perceptions of trustworthiness and interpersonal connection are influenced by communication about limited money (e.g., “I don’t have money”) and time (e.g., “I don’t have time”). Communicating money constraints (but not time) increases trust and interpersonal connection because money is seen as outside of one’s personal control. I conclude with a discussion of my future research agenda.