Old Money Gets Spent More Quickly, Study Finds

If you want to save money, it might be a good idea to ask for new bills when you make a bank withdrawal, a new study suggests. Canadian researchers found that many people find worn paper bills disgusting and will spend more to get rid of them, but are more likely to hold on to crisp new bills.

Study authors Fabrizio Di Muro, of the University of Winnipeg, and Theodore Noseworthy, of the University of Guelph, conducted a series of experiments in which people were given either worn or new bills and asked to complete a series of shopping tasks. The participants tended to spend more when they had worn bills than when they had new bills. The study participants also were more likely to break a worn larger bill than pay the exact amount in new bills, according to the study, which was released online in advance of print publication in the Journal of Consumer Research.

The participants, however, tended to spend the new bills when they thought they were being watched, the investigators found. “The physical appearance of money can alter spending behavior,” Di Muro and Noseworthy wrote. “Consumers tend to infer that worn bills are used and contaminated, whereas crisp bills give them a sense of pride in owning bills that can be spent around others.” “Money may be as much a vehicle for social utility as it is for economic utility,” the authors concluded. “We tend to regard currency as a means to consumption and not as a product itself, but money is actually subject to the same inferences and biases as the products it can buy.”

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