A person’s spending habits can infer certain psychological traits, according to new research published in Psychological Science.
Researchers looked at more than 2 million spending records from over 2,000 people to see whether differences in spending habits correlate with other individual differences.
The team used an ensemble machine-learning technique to a data set combining two million spending records from bank accounts with survey responses from the account holders.
According to the abstract of the study, the team’s predictive accuracies were “modest” for the Big Five personality traits (openness to experience, conscientiousness, extraversion-introversion, agreeableness, and neuroticism) but “provided higher precision” for specific traits, such as materialism.
Specific correlations between spending categories and traits the researchers identified:
- Those more open to experience were likely to spend more on flights.
- Those who were more extraverted were more likely to make dining and drinking purchases.
- Those who more agreeable donated more to charity.
- Those who were more conscientious put more money into savings.
- Those who were more materialistic spent more on jewelry and less on donations.
“Now that most people spend their money electronically – with billions of payment cards in circulation worldwide – we can study these spending patterns at scale like never before,” said Joe Gladstone of University College London, who co-led the research. “Our findings demonstrate for the first time that it is possible to predict people’s personality from their spending.”
“We expected that these rich patterns of differences in peoples spending could allow us to infer what kind of person they were,” said Sandra Matz, who co-led the project.
“It didn’t matter whether a person was old or young, or whether they had a high or low salary, our predictions were broadly consistent,” Matz added. “The one exception is that people who lived in highly deprived areas were more difficult to predict. One possible explanation may be that deprived areas offer fewer opportunities to spend money in a way that reflects psychological preferences.”
Journal Citation
“Can Psychological Traits Be Inferred From Spending? Evidence From Transaction Data”
Joe J. Gladstone, Sandra C. Matz, Alain Lemaire
Psychological Science Vol 30, Issue 7, 2019
https://doi.org/10.1177/0956797619849435