Financial scarcity is known to negatively affect well-being of young adults, leading to heightened stress and uncertainty about their financial future. Despite the availability of numerous debt...Show moreFinancial scarcity is known to negatively affect well-being of young adults, leading to heightened stress and uncertainty about their financial future. Despite the availability of numerous debt relief and financial counselling programs, too little use is being made of this offered assistance. The reluctance to accept help may be influenced by a strong desire for autonomy. This study aimed to assess the association between the implicit need for autonomy and the willingness to accept help in young adults experiencing financial scarcity. Participants completed a survey that included a modernized Picture Story Exercise and a self-report questionnaire on help acceptance. Results from a multivariate regression analysis gave a marginally significant result showing that a higher implicit need for autonomy was associated with a slightly higher likelihood of help acceptance behavior, and with a more negative emotional attitude towards accepting help. Exploratory analyses highlighted that negative feelings about financial debt were a stronger predictor of help acceptance. These results underscore the importance of considering autonomy and debt-related feelings in improving interventions for young adults facing financial scarcity.Show less
Research master thesis | Psychology (research) (MSc)
closed access
Poverty in the UK has increased, particularly after the Covid-19 pandemic. To prevent people from falling into a poverty trap, it is important to understand how financial scarcity affects financial...Show morePoverty in the UK has increased, particularly after the Covid-19 pandemic. To prevent people from falling into a poverty trap, it is important to understand how financial scarcity affects financial decisions involving risks. This topic lacks consensus in the literature with some authors arguing for a tendency towards more risk-taking, while others arguing for more risk aversion. This study posits that the risk tendency is influenced by frames of gains and losses. More specifically, financial scarcity leads to more risky choices in the domain of losses (H1), whereas it leads to less risky choices in the domain of gains (H2). People in financial scarcity tend to experience negative affect that impacts their cognitive systems, leading to more reliance on System 1 thinking, which exacerbates biases, such as the reflection effect. To test the hypotheses an online survey was conducted and 200 participants from the UK were recruited via Prolific Academic. The participants were divided into two groups for the manipulation of financial scarcity using the household task. Half of the participants were in the debts condition (financial scarcity), whereas the other half were not (control). Subsequently, all participants were presented with six risky choices, where they had to choose one of two options (one risky, the other conservative) framed in both gains and losses and three combinations of probabilities. Results from a Generalized Mixed Model showed that the cognitive bias associated with the reflection effect was found to be equally present in everyone and was more pronounced for more extreme probabilities (e.g., 10%/90% and 20%/80%), but not for moderate probabilities (e.g., 40%/60%). Thus, the expected interaction between debts and frames was not confirmed. It is suggested that future studies use an intuitive decision-making manipulation with more extreme probabilities (e.g., 1%/99%), consider a field risk manipulation, an incentivized lottery and the same expected value within and between probabilities at the lottery.Show less
Financial scarcity refers to the perception of having insufficient monetary resources to meet daily demands. There is an ongoing debate on how financial scarcity affects social decision-making,...Show moreFinancial scarcity refers to the perception of having insufficient monetary resources to meet daily demands. There is an ongoing debate on how financial scarcity affects social decision-making, such as the decision to act prosocially. The current study examined the relationship between financial scarcity and prosocial behavior and whether the basic psychological needs for autonomy, relatedness, competence, or attentional focus mediate it. The study was conducted on 120 participants using an experimental design with Household Tasks, a Dictator game, and self-reported questionnaires. No direct relationship between financial scarcity and prosocial behavior was found. Nonetheless, participants with financial scarcity acted less prosocially towards individuals with financial abundance. Financial scarcity negatively impacted satisfaction of the basic psychological need for relatedness. The basic psychological need for autonomy and attentional focus on one's own financial situation reduced prosocial behavior. No mediating mechanisms were found. The study further discusses limitations, implications for interventions, and future research.Show less
