Having less means wanting more: Children hold an intuitive economic theory of diminishing marginal utility

Influential Attributes on Medical Expense for Korean Older Adults Based on Mental Accounting: Panel Data Analysis Using Korean Longitudinal Study of Aging Data

Backgrounds: Korean society is entering an aging society, and this phenomenon indicates the need for preparation for aging in Korean society. In such a situation, exploring the characteristics of the elderly can be considered important for preparation. The objective of this study is to identify the determinants of medical expenses among older adults in South Korea. The key factors analyzed include food, leisure, and housing expenses, as well as lifestyle choices such as drinking and smoking. Method: Data from the Korean Longitudinal Study of Aging, covering 7374 observations from the years 2018 and 2020, are adopted for statistical analysis. This research explores the inverted-U-shape effect of food, leisure, and housing expenditures on medical costs, grounded in the concepts of diminishing marginal utility and mental accounting. A quadratic panel regression analysis is used to test the hypotheses, controlling for variables such as birth year, gender, and personal assets. Results: The results show that food and housing expenses have an inverted-U relationship with medical expenditures based on diminishing marginal utility and mental accounting as the theoretical foundation. However, leisure expenses, drinking, and smoking do not significantly affect medical expenses. Furthermore, this study identifies the optimal expenditure levels for maximizing medical spending through the first-order condition. Conclusions: These findings provide important insights for the development of policies aimed at improving the financial well-being of older adults in South Korea. Moreover, this study contributes to the literature by applying the concepts of mental accounting and the law of diminishing marginal utility to better understand the financial behavior of older adults.

Exploration of the Determinants of Subjective Health and Depression Using Korean Longitudinal Study of Aging Data

Aging is an imperative issue in Korean society, and a healthy life is important for a better quality of life for older adults. Therefore, the purpose of this research was to investigate the determinants of subjective health and depression in middle-aged and elderly Korean individuals. This study used three attributes as the determinants of subjective health and depression, including the curve linear effect of medical expenses and eating-out expenses and the linear impact of regular exercise. We utilized the Korean Longitudinal Study of Aging (KLOSA) to determine the associations between five attributes: subjective health, depression, medical expenses, eating-out expenses, and regular exercise. Research panel data were employed as the data source. The study period was between 2018 and 2020. This research implemented various multiple linear panel regression econometric analysis instruments: ordinary least squares, random effects, and fixed effects. The mean age of survey participants was 72.10 years, and 35 percent of participants were female. The number of observations for data analysis was 7197. The results revealed that medical and eating-out expenses had a curved linear effect on subjective health and depression. Moreover, regular exercise positively affected subjective health and resulted in less depression. These findings may inform policy decisions that promote regular exercise and manage medical and eating-out expenses, thereby enhancing subjective health and mitigating depression.

Children think differently from adults when reasoning about resources acquired from parents

Although sharing is often considered a virtuous behavior, individuals rarely share all their extra resources with those less fortunate. The current research investigated conditions under which children believe that someone who has more resources deserves to keep them rather than address an inequality. Specifically, we contrasted resources acquired via merit, windfall, and parental allocations. Across two studies, we showed 5- and 6-year-old children (n = 59), 8- and 9-year-old children (n = 120), and adults (n = 163) three scenarios in which one person acquired more resources than the other due to luck, due to merit, or because that person's parents gave him or her more, and we asked whether that person should share these resources or keep all of them. Results suggested that adults differentiated both the family resource and the merit conditions from the windfall allocation, believing that an agent deserves to keep the extra resources more when they are acquired through one's family or due to merit. However, children did not differentiate family resources from windfall, although they were more likely to believe that individuals deserve to keep their extra resources when they were acquired through merit. The type of the resource (i.e., money vs. balls) did not affect participants' sharing decisions. Overall, these findings suggest that over development the resources acquired from one's family come to be seen as more deserved than windfall resources.

Recalling experiences of scarcity reduces children's generosity relative to recalling abundance

Does a sense of having less or more than what one needs affect one's generosity? The question of how resource access influences prosocial behavior has received much attention in studies with adults but has produced conflicting findings. To better understand this relationship, we tested whether resource access affects generosity in the developing mind. In our preregistered investigation, we used a narrative recall method to explore how temporary, experimentally evoked states of resource abundance or scarcity affect children's sharing. In this study, 6- to 8-year-old American children (N = 148) recalled an experience of scarcity or abundance and then chose how many prizes to share with another child. We found that children in the scarce condition rated themselves as sadder, viewed their resource access as more limited, and shared fewer tokens than children in the abundant condition. Our results indicate that recalling past experiences of resource access creates distinct behavioral consequences for children and suggest that a sense of "having less" may encourage a strategy of resource conservation relative to a sense of "having more," even at a young age.

Emotions before actions: When children see costs as causal

Adults expect people to be biased by sunk costs, but young children do not. We tested between two accounts for why children overlook the sunk cost bias. On one account, children do not see sunk costs as causal. The other account posits that children see sunk costs as causal, but unlike adults, think future actions cannot make up for sunk costs. These accounts make opposing predictions about whether children should see sunk costs as affecting emotions. Across three experiments, 4-7-year-olds (total N = 320) and adults (total N = 429) saw stories about characters who collected items that were easy or difficult to obtain, and predicted characters' emotions and actions. At all ages, participants anticipated that characters would feel sadder about high-cost objects, but only adults predicted that characters would keep high-cost objects. Our findings show that children see incurred costs as causal, and that costs are integrated children's and adults' theory of emotions. Moreover, the findings suggest that developmental differences in sunk cost reasoning may rest in children's incomplete mental accounting. We also discuss children's reasoning about rational and irrational action.

Analysis on the synchronized development between urbanization process and eco-efficiency through the sustainability lens

Urbanization and eco-efficiency are two interactive systems, contributing to sustainable urban development jointly. However, the synchronized development between them has not received sufficient attention. In light of this gap, this paper conducts an analysis on seeking the synchronized development between sustainable urbanization and eco-efficiency in the context of China. The aim of this study is to uncover the spatial and temporal performance of the synchronized relationship between urbanization process (UP) and eco-efficiency (EE) in a sample of 255 Chinese cities. To this end, entropy method, super efficiency SBM and coupling coordination degree model are employed to conduct the research analysis, covering the period of 2005 to 2019. The findings of this study reveal that (1) there is about 97% of the surveyed cities that exhibit a moderate level of coupling coordination between urbanization process and eco-efficiency (CC-UE). (2) Spatial disparities in the performance of CC-UE are evident, with cities in South and Southeast China demonstrating better CC-UE performance than their counterparts. However, this disparity has been gradually diminishing in recent years. (3) Local perspective presented an evident spatial autocorrelation within the 255 cities analyzed. These research findings provide valuable insights not only for the policy-makers and practitioners to adopt measures for achieving a synchronized development between urbanization process and eco-efficiency in the Chinese context, but also for further studies on sustainable development in the international context.