It's no accident that money obtained through dishonest or illegal means is called "dirty money." A new study from the University of California, Berkeley, suggests that when people perceive money as morally tainted, they also view it as having less value and purchasing power.
Challenging the belief that "all money is green," and that people will cross ethical boundaries to amass it, social scientists from UC Berkeley and Stanford University have found compelling evidence that the source of wealth really does matter. In fact, some people avoid ill-gotten gains – such as profits from unfair labor practices or insider trading – for fear of "moral contagion," according to a paper published this week in the online issue of the journal Social Psychological and Personality Science.
"Our work suggests morality is an important force shaping economic decision-making," said Jennifer Stellar, a doctoral student in psychology and lead author of the study. "Though we often think $50 is $50, these results demonstrate that when money takes on negative moral associations, its value is diminished."
The findings help explain the psychology behind such economic trends as socially responsible investing and the boycotting of sweatshop-produced goods. They also shed some light on why companies go to great lengths to avoid the perception that they are accepting money from corrupt investors or are themselves profiting from illegal or unethical practices, researchers said.
"People possess powerful motivations to view themselves as fundamentally good and moral," said Robb Willer, associate professor of sociology at Stanford University and co-author of the paper. "We find this motivation is so great that it can even lead people to disassociate themselves from money that has acquired negative moral associations."
The first experiment involved 59 college-age participants who were told they could enter a raffle for a $50 cash prize sponsored by one of two corporations. They were then split into an "immoral money" group and a "neutral money" group.
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