Luxury makes you mean

A survey released in the latest edition of Harvard Business Review proposes that luxury seems intrinsically linked to self-interest.

The study, entitled “The Devil Wears Prada? Effects of Exposure to Luxury Goods on Cognition and Decision Making,” was conducted by researchers Roy Y J Chua, of Harvard, and Xi Zou, an assistant professor at London Business School. They contend that luxury goods can affect decision-making in a way that increases self-interest and affects behaviour negatively as a result. Specifically, they hypothesise that luxury does not make you ‘mean’ per se, just indifferent.

The researchers studied students who were randomly assigned to either a “luxury goods” condition or a “non-luxury goods” condition, and viewed photographs of associated consumer products such as shoes and watches. The students were then asked to imagine various scenarios that might arise if they were CEO of a firm.

The students who viewed luxury goods were significantly more likely than the second group to endorse production of a new car that might pollute the environment, launch a new software with bugs, or market a video game that might induce violence, according to the study.

The study contends that “…when primed with luxury, people endorsed self-interested decisions that could potentially harm others,” and “Luxury-primed individuals tend to make decisions that are self-interested and arguably unethical.” Chua and Zou suggest the same business meeting could reach different decisions when held at a fancy resort as opposed to in a modest conference room, which is entirely plausible, and “Working in a business setting surrounded by money and luxuries might well have an effect on cognition and decision making.”

An interesting project with some undoubtedly clear and undeniable findings that will strike a chord with many and particularly poignant for the US economy and concerns that consumers and corporations have about the future. In closing, they leave us with a thought: “Perhaps limiting corporate excesses and luxuries might indeed be a step toward getting executives to behave more responsibly.”

We don’t think luxury marketeers need to worry any time soon as the fundamental drivers of human nature are not changing that quickly and brands are learning to adapt appropriately to societal trend changes and still maintain growth.