Money, Charity, and Emotions
The psychology of money is more complicated that economics would want it to be.
Posted February 20, 2018
One book that had a big impact on me was The Social Meaning of Money by sociologist Viviana Zelizer. The book points out that money was created to make it easy for people to engage in transactions and to give value to things. The amazing thing about money is that every dollar is supposed to be the same as every other dollar.
But, people spend a lot of time engaging in activities to differentiate types of money. We put aside money for the holidays to buy gifts rather than spending it on utilities or necessities. We make some kinds of money hard to access in order to save for retirement. Using examples from the late 19th and early 20th century, Zelizer looks at the many ways that people create special types of money.
This book clearly had an impact on a lot of people, because I was recently introduced to a wonderful collection of essays called Money Talks that has chapters by researchers from many disciplines who were influenced by this work.
One of the chapters in this book I particularly enjoyed was written by Nina Bendelj and several colleagues and focused on moral dimensions of money.
One study they described looked at how social categories people belong to affected their charitable giving. The participants were college students who were staked with an initial amount of money and were told they could donate the money to one of four charities (Amnesty International, UNICEF, Doctors Without Borders, and the American Cancer Society) and that any money they didn’t give away they were free to keep. Participants were told that their donation to the charity would be anonymous. Participants also answered several questions including giving reasons for why they chose to give (or not to give).
The majority of students chose to give some money to one of the charities and several gave all of the money away. Unsurprisingly, students who responded that it is important to them to help others were more likely to give money (and gave more money) than students who responded that it is not that important for them to help others.
One interesting finding was that most students chose to give either to UNICEF or the American Cancer Society. The other two charities were rarely chosen.
Most of the participants who gave to UNICEF (which is a fund that helps children) were women. Nearly all the women who chose to give to UNICEF talked about how it is important to do good things for children. As the authors point out, this reasoning is consistent with the traditional gender roles of men and women, even though none of the participants in this study were parents yet.
Of the people who gave to the American Cancer Society, roughly the same number of men and women donated. For this charity, the reasons for giving tended to be personal. Many of the participants stated that they chose to give because of a personal experience with someone who has cancer.
These results bear on how people make the choice to devote some money to charity. One interesting finding is that people’s social categories affect this decision. Even though many college students might bristle at the idea that they are constrained by gender norms, women were much more likely than men to give to a charity aimed at children.
In addition, people’s personal experiences affect their affinity for charities. Charities like Doctors Without Borders and Amnesty International, which help people that are socially distant from the participants were not attractive as options for giving. Charities related to people’s interests and experience were much more likely to get donations.
Ultimately, this demonstrates how the way people use money is influenced by their social roles and emotions. Money is not a separate and purely economic entity. Instead, it is an object that is bound up with people’s motivations, hopes, and dreams.
Zelizer, V.A. (1994). The social meaning of money. Princeton, NJ: Princeton University Press.
Bandelj, N., Boston, T., Elyachar, J., Kim, J., McBride, M., Tufail, Z. & Weatherall, J.O. (2017). Morals and emotions of money. In N. Bandelj, F.F. Wherry, & V.A. Zelizer (Eds.) Money talks: Explaining how money really works. (pp. 39-56). Princeton, NJ: Princeton University Press.