TY - JOUR
T1 - The Psychology of COVID-19 Economic Impact Payment Use
AU - Asebedo, Sarah D.
AU - Quadria, Taufiq Hasan
AU - Gray, Blake T.
AU - Liu, Yi
N1 - Publisher Copyright:
© 2021, The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature.
PY - 2022/6
Y1 - 2022/6
N2 - This study investigates how American adults’ personality and financial self-efficacy (FSE) beliefs contributed to how they used their COVID-19 CARES Act Economic Impact Payment (EIP) for spending needs, spending wants, and financial transactions (save, invest, debt repayment). The results from a sample of 1172 Amazon MTurk users collected in July 2020 suggest that both personality traits and FSE beliefs were associated with EIP use. Specifically, this study finds that FSE and conscientiousness emerged as the most robust predictors of EIP use across all categories of financial behavior with a greater allocation of EIP funds to saving and less to spending needs and debt repayment. Additionally, greater FSE is associated with investing, while greater conscientiousness is connected to more spending on wants. The results suggest that saving habits associated with personality and FSE persist in a crisis environment, and pre-crisis preparedness may allow for greater spending flexibility on wants. Significant relationships were also found for openness, extraversion, agreeableness, and neuroticism. The findings highlight how people use unexpected financial windfalls during crises and uncertainty and how personal characteristics contribute to this decision making.
AB - This study investigates how American adults’ personality and financial self-efficacy (FSE) beliefs contributed to how they used their COVID-19 CARES Act Economic Impact Payment (EIP) for spending needs, spending wants, and financial transactions (save, invest, debt repayment). The results from a sample of 1172 Amazon MTurk users collected in July 2020 suggest that both personality traits and FSE beliefs were associated with EIP use. Specifically, this study finds that FSE and conscientiousness emerged as the most robust predictors of EIP use across all categories of financial behavior with a greater allocation of EIP funds to saving and less to spending needs and debt repayment. Additionally, greater FSE is associated with investing, while greater conscientiousness is connected to more spending on wants. The results suggest that saving habits associated with personality and FSE persist in a crisis environment, and pre-crisis preparedness may allow for greater spending flexibility on wants. Significant relationships were also found for openness, extraversion, agreeableness, and neuroticism. The findings highlight how people use unexpected financial windfalls during crises and uncertainty and how personal characteristics contribute to this decision making.
KW - Big five personality traits
KW - CARES Act
KW - COVID-19
KW - Economic impact payments
KW - Financial self-efficacy
KW - Spending needs and wants
UR - http://www.scopus.com/inward/record.url?scp=85120545825&partnerID=8YFLogxK
U2 - 10.1007/s10834-021-09804-1
DO - 10.1007/s10834-021-09804-1
M3 - Article
AN - SCOPUS:85120545825
SN - 1058-0476
VL - 43
SP - 239
EP - 260
JO - Journal of Family and Economic Issues
JF - Journal of Family and Economic Issues
IS - 2
ER -