[Study] Do People Care More About Saving Time or Money?

Unless you have been living under a rock, you have probably heard the phrase, “Time is money.” It is often attributed to Benjamin Franklin (as many wise sayings are) but has been found to predate his writings. Regardless of who first said it and when it was said, we understand the concept. If we spend our time engaging in productive behaviors, we will earn more money. If we spend our time engaging in less productive behaviors, we will earn less money. In a rudimentary economic sense, it’s hard to argue with this.

But is spending time and spending money the same thing psychologically? We can intuitively grasp that money and time are interchangeable, but do we behave in such a way that demonstrates we really believe it’s true? That is the question the following article sets out to answer…

Article Summary: Which is the Better Option? Quicker or Cheaper?

Chang, C., Chang, S., Chang, J., & Chien, Y. (2013). Which Is the Better Option? Quicker or Cheaper?. Psychology & Marketing, 30(1), 90-101.

Shin-Shin Change of Chung Yuan Christian University and Chung-Chau Chang, Jung-Hua Change, and Ya-Lan Chien of National Taiwan University argue that there is a difference between the way we spend our money and the way we spend our time. Although both time and money are often simultaneously considered in making decisions (i.e. paying more for faster download speeds), it is possible that we prefer saving one at the expense of the other.

Theoretical Framework

To set up the experiment, the authors highlight some of the fundamental differences between time and money:

  • Usage: Time is used passively and subconsciously while money is almost always used consciously.
  • Source: Time is a constant, inherent resource where as money is often earned.
  • Evaluation: Time is evaluated subjectively while money is evaluated objectively.
  • Budget Constraints: Time is limited to 24 hours while money has no theoretical limit.
  • Fungibility: Present time cannot be saved for future use while present money can.
  • Expectation: People are more likely to expect a future surplus of time than money.
Based on these underlying differences, the authors create a series of hypotheses about whether peoples’ preferences will lie with saving time or saving money in certain contexts.

The Experiments

The authors conduct three experiments in which they seek to answer questions about our preferences involving time and money. Each experiment corresponds to a hypothesis:

Hypothesis 1: People prefer the benefits of saving money to those of saving time.

Experiment one consisted of a survey administered to 77 undergraduate students in which they were presented with fictional scenarios involving trade-offs between time and money and asked about their preferences. The survey demonstrated that the preference for saving money was significantly higher than the preference for saving time.

Hypothesis 2a: Prompting people with the value of time increases their preferences for saving time over saving money.

Hypothesis 2b: Prompting people with the value of money has no affect on their preference for saving money over saving time.

A group of undergraduates were presented with two fictional scenarios, both involving a business trip abroad. In one scenario, an option to save time is presented to them and, in the second scenario, an option to save money is presented to them. When surveyed, the students reveal that mentioning the value of time increases their preferences for saving it while mentioning the value of money has no affect on increasing their preferences for saving it.

Hypothesis 3: Peoples’ preference for saving time diminishes more quickly over time than their preference for saving money.

Undergraduates were presented with two different scenarios, one involving saving time and another involving saving money. They were then surveyed about their attitudes involving time and money as well as their intentions as to which program they would adopt now, one month later, and six months later. The results showed that the preference for saving time diminished over time according to peoples’ intentions but not according to their attitudes.

Summation of the Results

The authors results can be summed up in these key findings:

  1. People prefer to save money than to save time.
  2. Prompting people with the value of time increases their preferences for saving it.
  3. Prompting people with the value of money has no effect on their preferences for saving it.
  4. As time passes, people increase their intentions of saving time.

Real-World Implications

The real eye-opener for me on this one is that, without being prompted with the value of time, people prefer to save money. When you really think about it, time is always more precious. Money is volatile. You can lose it all and gain it all back in a single day. With time, it’s either use it or lose it. While most of us understand the value of time intellectually, few of us behave as if we do. We squander our time all the while pinching pennies.

I think this research is a wake-up call to be more cognizant of how we are spending our time. Whether we are at work serving our customers or we are out shopping, we must realize that time is our most scarce and valuable resource. It costs more to try to fix the computer yourself than it does to hire an IT guy to do it. It costs more to travel to the other end of town for a better price than it does to just settle for what’s right down the street. Because, in both of these scenarios, we are losing time. We need to be constantly aware of the seconds ticking away. Because, if we aren’t aware of it, we’ll squander it.

Questions for Future Research

  1. Would the results hold for groups other than undergraduates? People working full-time? People who are retired?
  2. How could this study be done using observation rather than surveys? Would people behave differently than they say they would?
  3. How can people increase the extent to which they are conscious of how they are spending their time?
  4. Would the results of the study still hold across income levels?

Featured image courtesy of servus licensed via Creative Commons.

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About Douglas E Rice

Douglas E Rice is just a guy who likes to learn stuff.
This entry was posted in blog, Psychology, Studies. Bookmark the permalink.

5 Responses to [Study] Do People Care More About Saving Time or Money?

  1. MZazeela says:

    Interesting research, Doug. As you have asked, it would be interesting to see if the results are consistent when the tests are administered to different groups under different circumstances.
     
    Also, I wonder how the results would be affected if the subjects had been indoctrinated with a view of monetized time. While it is easy to understand that time is valuable,  would it make the test results different if a specific dollar value were place on a specific block of time?
     
    Cheers,Marc

    • douglaserice says:

      @MZazeela Thanks, Marc. Yeah, I was hoping that there would be actual experiments but, as I dug in, they were really just surveys. I couldn’t hope but think there was some way to test this through observation behaviors. I think that’s the real key to understanding decision-making, not asking about our attitudes and intentions.

      • MZazeela says:

        @douglaserice It would also be interesting to see how your question number one pans out? “Would the results hold for groups other than undergraduates? People working full-time? People who are retired?
         
        As I get older, I value time more than I used to. I suppose we begin to realize that time is finite, in some sense.

      • douglaserice says:

        @MZazeela Marc, that’s the key problem I’m seeing with a lot of academic research–the population is often only composed of undergraduate college students…because they are cheap and accessible. Some studies, it doesn’t matter so much.This one, I think it might…

      • MZazeela says:

        @douglaserice Maybe we could do some informal research in the form of a Linkedin poll? Would reach a broader cross section of people.

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