Niro Sivanathan

Conspicuous consumption and its accompanying debt played a critical role in crippling global financial markets in 2008. Although a confluence of factors contribute to hyper-consumerism, the authors explore the potential role of two psychological forces—the desire to combat self-threats through compensatory consumption and the relatively pain-free experience of consuming on credit—that may have interactively contributed to the pernicious cycle of consumption and debt. Consistent with their predictions, the authors find that self-threat sways individuals to consume with credit over cash (Experiment 1) and the interactive effect of self-threat, product status, and payment method creates a perfect storm, whereby threatened individuals not only seek to consume high-status goods but also, when using credit, do so at higher costs to themselves (Experiment 2). These findings have broad implications for consumer decision making and offer psychologically grounded insights into the regulation of lending policies aimed at promoting consumer health.

Physical cleanliness has many medical benefits, such as protection from the dangers of contagion. We explore a potential unintended consequence of cleanliness. Given the metaphorical association between physical cleanliness and moral purity (Zhong & Liljenquist, 2006), we contend that a clean self may also be linked to a virtuous self. This enhanced moral self-perception can in turn license harsher moral judgment. Three experiments found that cleanliness, whether induced via physical cleansing or through a visualization task, licensed severe judgment on morally contested issues such as abortion and pornography. Further, we found that an inflated moral self mediated the relationship between cleanliness and moral judgment. These results provide unique insight to the social significance of cleanliness and may have important implications for discrimination and prejudice.

Individuals conspicuously consume to signal their wealth. As a variant to this economic explanation, four studies explored individual’s psychological need for self-integrity as a potential motivating force for these consumption decisions. Relying on both field and experimental studies, and employing multiple instantiations of high-status goods and self-threat, we demonstrate that individuals consume status-infused products for their reparative effects on the ego. Individuals under self-threat sought ownership of high-status goods to nurse their psychological wounds (Study 1), and when afforded an alternate route to repair their self-integrity, sought these products less (Study 2). Furthermore, among a representative sample of US consumers, low-income individuals’ lowered self-esteem drove their willingness to spend on high-status goods (Study 3). Finally, these high-status goods serve the purpose of shielding an individual’s ego from future self-threats (Study 4). The compensatory role of high-status goods has important implications for consumer decision-making and public policies aimed at reducing consumer debt.

Individuals often honor sunk costs by increasing their commitment to failing courses of action. Since this escalation of commitment is fueled by self-justification processes, a widely offered prescription for preventing escalation is to have separate individuals make the initial and subsequent resource allocation decisions. In contrast to this proposed remedy, four experiments explored whether a psychological connection between two decision-makers leads the second decision-maker to invest further in the failing program orchestrated by the initial decision-maker. Across three different contexts (financial investments, personnel decisions, and auctions), we found that multiple forms of psychological connectedness (perspective-taking, shared attributes, and interdependent mindsets) led decision-makers to vicariously justify others’ initial decisions and escalate their own commitment to these decisions – even in the face of direct financial costs to themselves, and even among economics students trained in the irrationality of honoring sunk costs. The ability of subtle psychological connections to undermine the conventional prescription for de-escalation has important implications for organizations, public policy, and theories of escalation.

. Three experiments demonstrated that the experience of power leads to an illusion of personal control. Regardless of whether power was experientially primed (Experiments 1 and 3) or manipulated through roles (manager vs. subordinate; Experiment 2), it led to perceived control over outcomes that were beyond the reach of the power holder. Furthermore, this illusory control mediated the influence of power on several self-enhancement and approach-related outcomes reported in the power literature, including optimism (Experiment 2), self-esteem (Experiment 3), and action orientation (Experiment 3). These results demonstrate the theoretical importance of perceived control as a generative cause of and driving force behind many of power's far-reaching effects. A fourth experiment ruled out an alternative explanation: that positive mood, rather than illusory control, is at the root of power's effects. The discussion considers implications for existing and future research on the psychology of power, perceived control, and positive illusions.

When bad decisions force business leaders to leave their jobs, organizations often rush to replace them with insiders, who are familiar with the original problem and the former leader. In times of turmoil, the choice seems natural and even obvious: Because insiders know the past, they should be less likely to repeat it. General Motors pointedly replaced Rick Wagoner as its chief executive officer with his protégé Fritz Henderson, a career GM employee. However, our research reveals that despite the natural inclination to opt for an insider with connections to the old boss, a failing leader is often better replaced with a completely unrelated outside party.

Few interpersonal relationships endure without one party violating the other's expectations. Thus, the ability to build trust and to restore cooperation after a breach can be critical for the preservation of positive relationships. Using an iterated prisoner's dilemma, this article presents two experiments that investigated the effects of the timing of a trust breach—at the start of an interaction, after 5 trials, after 10 trials, or not at all. The findings indicate that getting off on the wrong foot has devastating long-term consequences. Although later breaches seemed to limit cooperation for only a short time, they still planted a seed of distrust that surfaced in the end.