What Affects the Value of Our Time? The Case of Buying a Present vs. Buying for Ourselves and the Impact of Decision-Making Styles

Abstract

We study how the buying purpose affects the trade-off between time and money. We consider the case of buying something for ourselves versus buying a gift and the decision whether to spend time traveling to a cheaper store to save money. We hypothesized that when purchasing a gift, people make less effort to save money, and therefore will be less willing to spend time traveling to a cheaper store when they buy a gift. In experiments with several scenarios, we fail to find support for this hypothesis. We also explore the impact of telling subjects that the purchase is made abroad. This is hypothesized to increase the valuation of the buyer’s time. We also hypothesize that the interaction of being abroad and buying a gift will be negative. The data support both hypotheses. Subjects answered 15 questions about their decision-making style (rational, intuitive, and spontaneous). Subjects with more rational decision-making exhibit lower time value, which is likely to be closer to the real one. Subjects with more rational decision-making also show more strongly that time abroad is more valuable. These results suggest that questions about decision-making style are correlated with decision-making in scenarios of realistic purchase decisions.