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Perhaps it has something to do with their field of choice, economics AKA the dismal science, but many of the world’s most famous economists share one extraordinary trait: they’re cheapskates!
Some economists may be cheap, at least by the standards of other people, because of their training or a fascination with money and choices that drives them to the field.
In recent research, University of Washington economists Yoram Bauman and Elaina Rose found that economics majors were less likely to donate money to charity than students who majored in other fields. After majors in other fields took an introductory economics course, their propensity to give also fell.
"The economics students seem to be born guilty, and the other students seem to lose their innocence when they take an economics class," says Mr. Bauman, who has a stand-up comedy act he’ll be doing at the economists’ Atlanta conference Sunday night. Among his one-liners: "You might be an economist if you refuse to sell your children because they might be worth more later."
Economists long have studied "free riders," the sort of people who take more than their fair share of something when circumstances permit. Think of the person who orders the most expensive entr[eacute]e at a restaurant, knowing that the check will be shared equally among companions.
University of Wisconsin sociologists Gerald Marwell and Ruth Ames, in a 1981 paper, found that in experiments, economics students showed a much higher propensity to free ride than other students. In questioning after the experiment, the sociologists found that for many of the economics students, the concept of investing fairly "was somewhat alien."
Why are men so cheap? Blame testosterone:
"Our broad conclusion is that testosterone causes men essentially to be stingy," says Karen Redwine, a neuro-economist at Whittier College in California [...] To make this case, Redwine and her colleague Paul Zak, at the Claremont Graduate University in California, gave a testosterone-containing gel to 25 male university students, and then tested their generosity.
The students then played a simple economic game with another participant via a computer. One volunteer is tasked with splitting $10 with another volunteer in any way he likes. The other volunteer either accepts the offer or rejects it as unfair, in which case no one gets any money. Each volunteer played this game in both roles, on and off the testosterone gel.
Overall, the testosterone cream caused a 27 per cent reduction in the generosity of the offers, from averages of $2.15 to $1.57, Redwine and Zak found.
The article also described how oxytocin, the so-called cuddle chemical, can actually boost generosity: Link
The current economic crisis has altered the behavioral patterns of everday consumers, but some people really take it to the extremes. Meet the ultra-tightwads:
Amy VanDeventer has always been a cheapskate. The recession is taking her to new extremes.
Before the economy tanked, she was still wearing maternity clothes from her last pregnancy, clipping coupons and using hand-me-downs to dress her daughters, ages 2 and 3. Now, she’s salvaging bagel scraps left on their plates for pizza toppings and cutting lotion bottles in half so she can scrape out the last drops.
“I was already cheap,” said VanDeventer, a 36-year-old mortgage loan underwriter from Broomfield, Colo. “Now I am neurotic about it.” [...]
What surprises frugality bloggers is that many cheapskates such as VanDeventer haven’t lost their jobs and are not in danger of losing their homes. Many have stashed a good chunk of cash away. But the economic uncertainty is catapulting them to new levels of thriftiness.
“I do it out of fear because I would rather put that money in the bank or purchase something we really need,” said VanDeventer, who now saves about 50 percent of her take-home pay, up from 25 percent before the recession began more than a year ago.
(Photo: Ed Andrieski/AP)
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