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Personal loan users’ mental integration of payment and consumption

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Author Info
Bernadette Kamleitner ()
Erich Kirchler
Abstract

Buying a good on a loan entails numerous consumption and payment episodes. Loan users can either mentally integrate or separate these episodes. In order to identify the actual mental structures, we conducted 29 semi-structured interviews with current and prospective loan users. A content analysis revealed that a majority of loan users established a hedonically efficient one-way connection from the loan to the good; i.e., the good was perceived as unrelated to the loan, whereas, concurrently, payments were buffered by thoughts of the good. Furthermore, the analysis revealed that mental structures are less stable than sometimes assumed. Copyright Springer Science + Business Media, LLC 2006

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File URL: http://hdl.handle.net/10.1007/s11002-006-8521-9
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Publisher Info
Article provided by Springer in its journal Marketing Letters.

Volume (Year): 17 (2006)
Issue (Month): 4 (December)
Pages: 281-294
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:kap:mktlet:v:17:y:2006:i:4:p:281-294

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Web page: http://www.springerlink.com/link.asp?id=100312

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Related research
Keywords: Mental integration; Hedonic editing; Mental accounting; Consumer credit;

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  1. Soman, Dilip, 2001. " Effects of Payment Mechanism on Spending Behavior: The Role of Rehearsal and Immediacy of Payments," Journal of Consumer Research: An Interdisciplinary Quarterly, University of Chicago Press, vol. 27(4), pages 460-74, March.
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  4. Gourville, John T & Soman, Dilip, 1998. " Payment Depreciation: The Behavioral Effects of Temporally Separating Payments from Consumption," Journal of Consumer Research: An Interdisciplinary Quarterly, University of Chicago Press, vol. 25(2), pages 160-74, September.
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  6. Sarah Brown & Gaia Garino & Karl Taylor & Stephen Wheatley Price, 2005. "Debt and Financial Expectations: An Individual- and Household-Level Analysis," Economic Inquiry, Oxford University Press, vol. 43(1), pages 100-120, January. [Downloadable!] (restricted)
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  7. Ariely, Dan & Zauberman, Gal, 2003. "Differential partitioning of extended experiences," Organizational Behavior and Human Decision Processes, Elsevier, vol. 91(2), pages 128-139, July. [Downloadable!] (restricted)
  8. Arkes, Hal R. & Blumer, Catherine, 1985. "The psychology of sunk cost," Organizational Behavior and Human Decision Processes, Elsevier, vol. 35(1), pages 124-140, February. [Downloadable!] (restricted)
  9. Duxbury, Darren & Keasey, Kevin & Zhang, Hao & Chow, Shue Loong, 2005. "Mental accounting and decision making: Evidence under reverse conditions where money is spent for time saved," Journal of Economic Psychology, Elsevier, vol. 26(4), pages 567-580, August. [Downloadable!] (restricted)
  10. Hirst, D. Eric & Joyce, Edward J. & Schadewald, Michael S., 1994. "Mental Accounting and Outcome Contiguity in Consumer-Borrowing Decisions," Organizational Behavior and Human Decision Processes, Elsevier, vol. 58(1), pages 136-152, April. [Downloadable!] (restricted)
  11. Gourville, John T, 1998. " Pennies-a-Day: The Effect of Temporal Reframing on Transaction Evaluation," Journal of Consumer Research: An Interdisciplinary Quarterly, University of Chicago Press, vol. 24(4), pages 395-408, March.
  12. Ranyard, Rob & Craig, Gill, 1995. "Evaluating and budgeting with instalment credit: An interview study," Journal of Economic Psychology, Elsevier, vol. 16(3), pages 449-467, September. [Downloadable!] (restricted)
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