Relaxation Increases Monetary Valuations

Abstract:     
This research documents an intriguing empirical phenomenon whereby states of relaxation increase the monetary valuation of products. This phenomenon is demonstrated in six experiments involving two different methods of inducing relaxation, a large number of products of different types, and various methods of assessing monetary valuation. In all six experiments participants who were put into a relaxed affective state reported higher monetary valuations than participants who were put into an equally pleasant but less relaxed state. This effect seems to be caused by differences in relaxed and non-relaxed individuals’ mental construals of the value of the products. Specifically, compared to less-relaxed individuals, relaxed individuals seem to represent the value of products at a higher level of abstraction, which increases their perceptions of these products’ value. The phenomenon appears to reflect an inflation of value by relaxed individuals rather than a deflation of value by less-relaxed individuals.

Number of Pages in PDF File: 45

Keywords: Relaxation, Willingness-to-Pay, Affect, Judgmment, Decision Making, Construal Level Theory

JEL Classification: M31, C91, D46, D12

Accepted Paper Series