Time versus money

Abstract

Consumers are known to spend both time and money. These two resources are often seen as economically comparable because the value of one's time can be equated to a monetary amount, such as one's wage rate. Recent research suggests that even when time and money are economically equivalent, they are psychologically different. We discuss how time (versus money) leads to decision making that is more heuristic rather than systematic, to an orientation that is more emotional rather than value-maximizing, to a thinking process that is more holistic rather than analytic, and to a mindset that is more abstract rather than concrete. Implications arise for a variety of domains such as consumer search, happiness, product evaluation, and charitable giving.