The Devil Wears Prada?
Effects of Exposure to Luxury Goods on Cognition and Decision Making

Are people who travel in town cars and on corporate jets different—on a psychological level—from you and me? Does the availability of luxury goods "prime" individuals to be less concerned about or considerate toward others? The answer from new research seems to be yes.

HBS professor Roy Y.J. Chua and Xi Zou, an assistant professor at London Business School, suggest that luxury goods have an important effect on human behavior that is only now becoming clear—and that may have implications for addressing the continuation of objectionable choices among, for example, high-flying executives on Wall Street.

According to Chua, their research found that "people who were made to think about luxury prior to a decision-making task have a higher tendency to endorse self-interested decisions that might potentially harm others." Their findings are detailed in the HBS working paper "The Devil Wears Prada? Effects of Exposure to Luxury Goods on Cognition and Decision Making"

"Will the same business meeting reach different decisions when it is held at a luxury resort as opposed to a modest conference room?" the authors write. "Will CEOs who bequeath themselves expensive office facilities and luxurious corporate jets make different business decisions than those who do not? In this age of Wall Street excesses, these are pertinent questions that could further our understanding of why some [people] continue to place their own interests over others', even in difficult economic times."

 

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