The use of credit cards stimulates the brain’s reward system and the desire for more spending, according to a recent MIT study that examined the neuroscience of buying things.
The credit card purchase tells us to “step on the gas” and lead to more “shopping desires” in the future, said Drazen Prelec, author of the study and professor at MIT Sloan School of Management, in a statement.
Previous research has shown that people tend to spend more when paying by credit card than in cash. For this new study, the researchers used MRI machines to see what is going on in the brain when people are asked to buy an item with cash or a credit card.
While inside the MRI, participants saw various items on a screen, from video games to beauty products, which they could add to the shopping cart. They had the option to pay for the products with $ 50 in cash or credit card.
People were more willing to buy more expensive items with credit than cash and spent more when using a credit card, the study authors wrote.
When people bought things with a credit card, MRI showed that a region of the brain’s reward system, called a striatum, was activated. The striatum is responsible for the release of dopamine and is involved in reward, reinforcement, pleasure and even addiction.
“Reward networks in the brain that are activated by all kinds of rewards are activated by a credit card purchase,” said Prelec.
Credit card “tips”, such as logos or buy now buttons, essentially “trigger the search for rewarding products,” the study authors wrote.
Cash payment did not activate the reward networks.
So, what’s up with credit cards?
To begin with, the brain’s reward network “has been chronically sensitized by past credit card experiences,” the study authors wrote. In other words, “the act of putting that plastic credit card in hand is associated with pleasant shopping,” said Prelec in the statement.
Other studies have shown that paying with a credit card “can take the costs out of your mind,” wrote the study’s authors. Since you can postpone credit card payments, it separates the purchase from the payment in your mind, and you don’t have to experience the tangible and immediate pain of spending money, as with money.
It also matters if you are paying with the credit card you use for essentials, compared to one you use for things like travel and restaurants. Prelec said that neural activity changes depending on the card: “The card you use for restaurants and vacations creates a different appetite for spending than the card you use to buy gasoline for your card,” he said.
As consumers adopt new payment systems, such as contactless payment, it is important for people to understand how the neural reward mechanisms at work influence our consumption habits, he said.
Output check: Use this calculator to see exactly how much your third coronavirus stimulus check could be worth
Don’t miss out: This type of therapy can help people with depression to be more productive at work: study