The use of credit cards stimulates the brain’s reward system and the desire to spend more, according to a recent MIT study that examined the neuroscience of buying things.
Credit card shopping tells us to “step on gasoline” and lead to more “shopping cravings” in the future, said Drazen Prelec, study author and professor at the MIT Sloan School of Management.
Previous research has shown that people tend to spend more when paying with a credit card than cash. For this new study, researchers used MRI devices to see what happens in the brain when people are asked to buy a cash item or a credit card.
While inside the MRI, participants were shown various items on a screen, from video games to beauty products, which they could add to their shopping cart. They had the option to pay for the products with $ 50 in cash or a credit card.
People were more willing to buy more expensive items on 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 the striatum, had been activated. The striatum is responsible for the release of dopamine and is involved in reward, strengthening, pleasure and even addiction.
“Brain reward networks that are activated by all kinds of rewards are activated by a credit card purchase,” said Prelec.
Credit card “clues”, such as logos or purchase buttons, “essentially activate the search for rewarding products,” the study’s authors wrote.
Cash payment did not activate reward networks.
So what about credit cards?
For starters, the brain’s reward network “has been chronically aware of previous credit card experience,” the study’s authors wrote. In other words, “the act of putting that plastic credit card in your hand is associated with pleasant purchases,” Prelec said in a statement.
Other studies have shown that paying with a credit card “can reduce costs,” the study’s authors wrote. Because you can defer credit card payments, it separates the payment purchase from your mind, and you don’t have to experience the tangible, immediate sting of spending money, as you do with cash.
It also matters if you pay with the credit card you use for essentials, compared to one you use for things like travel and restaurants. Prelec said that the neural activity changes depending on the card: “The card you use for restaurants and holidays creates a different appetite than the card you use to buy gas for your card,” he said.
As consumers adopt new payment systems, such as contactless payment, it is important for people to understand how neural reward mechanisms influence our spending habits, he said.
Check it out: Use this computer to see exactly how much the third coronavirus stimulus check might be worth
Do not miss: This type of therapy can help people with depression to be more productive at work: study