People buy more junk food when using plastic

''The pain of paying in cash can curb impulsive urges to purchase unhealthy food products,'' Thomas writes with his co-authors in the June issue of the Journal of Consumer Research. "Credit card payments, in contrast, are relatively painless and weaken impulse control.''

The researchers analyzed the spending habits of 1,000 shoppers at a large chain store over six months in 2003 and then conducted two controlled experiments at Cornell and SUNY Binghamton, as well as an online experiment.

Previous studies had found that consumers are more reluctant to part with bills and coins than to use credit -- what the research has labeled "pain of payment." Thomas' team, however, established that the "pain" of paying in cash really only affects impulsive purchases of "vice" foods and not deliberate "virtuous" purchases. There was no difference, however, when consumers used credit and debit cards to buy food -- an unexpected finding.

"This is surprising," Thomas said, "because, unlike credit cards, debit cards are equivalent to cash; the money gets deducted from the consumer's bank account almost immediately. This result suggests that … even the mere abstractness of plastic payments can reduce the pain of payment and thus influence consumers' purchase decisions."

The key to understanding the findings, Thomas said, is that the so-called "vice" foods, such as Oreos and Coca-Cola, for example, are perceived as unhealthy and impulsive to buy. Shoppers therefore relate to vice foods on a purely "visceral" level, Thomas said, whereas they consider "virtue" foods (Quaker Oatmeal and Aquafina Pure Water, for instance) at a rational level as "utilitarian" products.

"So vice spending is more susceptible to pain of payment," Thomas said, and thus, to payment in cash, while form of payment doesn't affect virtue spending.

The findings not only showcase an interesting quirk of consumer psychology but also may help curb the epidemic of obesity in America today, said Thomas, who hopes that for some consumers, at least, the use of cash over cards might help them cut down on impulsive and unhealthy food purchases.

Thomas noted that various technological advances in the near future may also help consumers at the cash register.

"I believe and hope that we will soon start seeing technological advances in credit and debit cards that help consumers better manage their spending decisions," Thomas said. "For example, it might be useful to have an LCD chip in a card that shows the total monthly spending thus far, or the cumulative credit."

Co-authors of the study are Kalpesh Kaushik Desai, associate professor at SUNY Binghamton, and doctoral student Satheeshkumar Seenivasan of SUNY Buffalo.

Provided by Cornell University