In a new research paper, “Context-Dependent Drivers of Discretionary Debt Decisions: Explaining Willingness to Borrow for Experiential Purchases,” published in the Journal of Consumer Research, Tuck Associate Professor of Business Administration Eesha Sharma and co-author Stephanie Tully of the University of Southern California discovered that consumers are more willing to borrow for experiential versus material purchases, even though experiential purchases tend to have a shorter physical duration.
The findings counter previous research that suggests consumers prefer borrowing for longer-lasting purchases.
"It tells us more about when and why people are willing to borrow," Sharma told CNN in a recent interview. "We challenge the idea that people are more willing to go into debt for a longer lasting thing.”
Read the full story from CNN Money.