Living in wealthy neighborhoods increases material desires and maladaptive consumption

Abstract

Despite the presumed national economic benefits that result from high levels of discretionary spending, past studies suggest that material consumption decreases individual economic and subjective well-being. However, most research on the development of materialistic values has examined how persuasive materialistic messages cause materialism. We recruited 2702 participants to test our prediction that living in wealthy neighborhoods should increase material desires and maladaptive consumption in much the same way it decreases happiness. Interestingly, our regression models revealed that individual socioeconomic status (SES) and neighborhood SES have unique, and opposite, predictive patterns of material consumption. Specifically, after controlling for age, gender, and population size, greater neighborhood SES predicted greater desires for material consumption, more impulsive buying, and fewer savings behaviors while individual SES showed the reverse pattern. Our path model suggests that greater neighborhood SES leads to increased material desires, which then predicts more frequent impulsive buying, and fewer savings behaviors. We discuss why neighborhood SES might change values and consumer behaviors.