Experience Stern | News & Events

Excerpt from Mint Press News -- "[Raghubir and coauthor Joydeep Srivastava's] 2009 paper titled 'Denomination Effect' found that people are less likely to spend larger units of currency than their equivalent amount in smaller units; while their 2002 paper titled 'Effect of Face Value on Product Valuation in Foreign Currencies' found that tourists underspent when the face value of foreign currency was a multiple of the equivalent amount in their home currency, and vice versa. This rule, of course, is applicable not just to tourists: psychologically, one is less likely to spend, say, 1000 drachmas than the equivalent amount of less than 3 euros."

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