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Summary

The study found that consumers experiencing social exclusion are more likely to make high risk investments. This effect is moderated by consumers' level of mental budgeting such that at high levels of mental budgeting the effect of social exclusion on investment choice is attenuated. The study further finds that the moderating effect of mental budgeting is mediated by pain of payment.

The findings suggest that policymakers can reduce unduly risky personal investment behavior by triggering mental budgeting thoughts using methods such as advertising and mention of transaction fees.

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created an idea from a article:

EMERALD

The effects of mental budgeting and pain of payment on the financial decision making of socially excluded people

emerald.com

MORE IDEAS FROM THE SAME ARTICLE

Social exclusion

a state of physical/emotional isolation involving feelings of loneliness due to being left out, ignored or ostracised by others
leads to anti-social behaviour

Mental Accounting II

prospect theory: loss perception decreased in consumers in a low state of mental budgeting
psychological myopia: tendency to focus on immediately relevant information (e.g., transaction fees) while ignoring relevant background information stronger fo...

Hypotheses

H1: Socially excluded people have a higher preference for high-risk investment products than socially included people.

Mental Accounting

incl. mental budgeting (separation of monetary income into economic categories), labelling of income and assets, hedonic framing (evaluation of gains and loss combinations)
violates the fungibility assumption of money

Pain Of Payment

painful state of mind or psychological burden consumers experience upon purchase
lowered by credit card and mobile payments
bottom dollar effect: purchases using budgets close to exhaustion result in a lower customer satisfaction
high...