Claremore Daily Progress

Community News Network

January 20, 2014

Study: Money is addictive

WASHINGTON — There's a fundamental principle in economics that applies to food, clothing and even all those shiny tech gadgets that start with the letter "i": The more of them we have, the less we value them.

But that may not be true when it comes to money. New research from Jeffrey Pfeffer, a professor at Stanford Graduate School of Business, and his colleagues at the University of Toronto and Renmin University of China finds that the more money people make, the more they value it.

The research, published in the journal ILRReview, examined data from a longitudinal survey known as the British Household Panel Survey, as well the results from new experiments. Pfeffer and his colleagues calculated respondents' hourly income, as well as its growth over time, to separate money earned by actual work and money earned from other sources, such as investments. It then compared hourly earnings to respondents' views on how important it was to them to "have a lot of money."

"We thought it was quite possible that money was different because of its symbolic nature — when I pay you, I'm also signaling your worth," Pfeffer says.

And that's what they found. The more that people earned, the more they said money mattered to them. The same correlation was not true when it came to money made from sources unrelated to work. That kind of income, Pfeffer says, has "much less implication for one's sense of mastery or worth."

Pfeffer says the research provides implications for how chief executives and other workers are paid. When it comes to motivating employees, he thinks it's a reminder for managers to emphasize — instead of money — the organization's mission. He recalls the story of a human resource executive who spoke to his Stanford class about how his software company didn't give stock options — an idea that sounded like sacrilege in Silicon Valley. "He said, 'Look, a raise is only a raise for 30 days. After that, it's a salary.' "

Text Only
Community News Network
  • Dangerous Darkies Logo.png Redskins not the only nickname to cause a stir

    Daniel Snyder has come under fire for refusing to change the mascot of his NFL team, the Washington Redskins. The Redskins, however, are far from being the only controversial mascot in sports history.  Here is a sampling of athletic teams from all areas of the sports world that were outside the norm.

    July 28, 2014 3 Photos

  • 'Rebel' mascot rising from the dead

    Students and alumni from a Richmond, Va.-area high school are seeking to revive the school's historic mascot, a Confederate soldier known as the "Rebel Man," spurring debate about the appropriateness of public school connections to the Civil War and its icons.

    July 28, 2014

  • wd saturday tobias .jpg Stranger’s generosity stuns Ohio veteran

    Vietnam War veteran David A. Tobias was overwhelmed recently when a fellow customer at an OfficeMax store near Ashtabula, Ohio paid for a computer he was purchasing.

    July 28, 2014 1 Photo

  • 072214 Diamond Llama 1.jpg Llama on the loose corralled in Missouri town

    A llama on the lam cruised Main Street Tuesday before it mistook a resident’s fenced backyard for a place to grab a meal and freshen up.

    July 22, 2014 2 Photos

  • NWS-HB0713-HowardMartin-004.jpg Airman laid to rest back home in Indiana six decades after death

    The mystery of what happened to a military transport plane that disappeared in the fall of 1952 into an Alaskan glacier was solved two years ago when a helicopter crew spotted the wreckage. But it took another two years to retrieve the remains of Airman Howard Miller and 16 other servicemen passengers. Saturday, Miller was laid to rest in his hometown of Elwood, Ind., with full military honors. Hundreds turned out for the funeral and burial services.

    July 13, 2014 2 Photos

  • New York to offer free lunch to all middle-school students

    New York's $75 billion spending plan for the fiscal year that began last week includes the first step toward offering free lunch for all 1.1 million students, expanding a program now reserved only for the city's poorest children.

    July 9, 2014

  • Screen Shot 2014-07-09 at 11.24.10 AM.png VIDEO: Pilot buys pizzas for storm-delayed travelers

    A Frontier Airlines pilot went above and beyond the call of duty when a recent flight from Washington, D.C. to Denver was diverted to Cheyenne, Wyoming due to bad weather.

    July 9, 2014 1 Photo

  • Why North Korean cheerleaders may soon descend on the South

    When you think of North Korea, "cheerleaders" may not be the first thing that springs to mind. The Hermit Kingdom is perhaps better known for less savory things like gulag-like labor camps and leadership purges.

    July 8, 2014

  • Screen Shot 2014-07-08 at 11.46.13 AM.png VIDEO: Foiled beach gear theft goes viral

    Video capturing a bizarre confrontation with two women allegedly attempting to steal beach gear on a Florida beach has gone viral.

    July 8, 2014 1 Photo

  • Screen Shot 2014-07-08 at 10.40.20 AM.png VIDEO: Sleeping fan suing Yankees, ESPN for $10M

    A fan caught on camera sleeping during a recent game at Yankee Stadium has filed suit against the Yankees and ESPN, claiming he suffered emotional distress when two announcers mocked him on the air.

    July 8, 2014 1 Photo