Money: a Bias For the Whole

Arul Mishra, University of Iowa, USA
Himanshu Mishra, University of Iowa, USA
Dhananjay Nayakankuppam, University of Iowa, USA
We document a phenomenon, a “bias for the whole”, wherein greater value is perceived for currency in whole denominations compared to equivalent amounts of money in smaller denominations. This manifests itself in a lower inclination to part with the large bill while shopping or spending. We demonstrate across four experiments that this arises from the greater processing fluency experienced in processing the whole, as opposed to the parts. This processing fluency is hedonically marked and generates positive affect that is attributed to the money, resulting in an over-valuation of money, making one reluctant to part with it in exchange for products.
[ to cite ]:
Arul Mishra, Himanshu Mishra, and Dhananjay Nayakankuppam (2007) ,"Money: a Bias For the Whole", in NA - Advances in Consumer Research Volume 34, eds. Gavan Fitzsimons and Vicki Morwitz, Duluth, MN : Association for Consumer Research, Pages: 166.