When a Penny Saved is Not a Penny Earned

May 10th, 2017

Here’s a hypothetical question: Would you rather take a job with a $5,000 bonus that would cost an additional $1,000 in transportation expenses, or the exact same job with a $2,000 bonus and save $2,000 in transportation expenses? It’s not a trick question.

Professor Eesha Sharma, who studies behavioral economics and teaches marketing at the Tuck School of Business at Dartmouth College, surveyed 268 people online and found that 65 percent were more likely to choose the job with the $5,000 bonus, even though the dollar gain is the same for the two jobs.

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Naomi Snyder is the editor for Bank Directoran information resource for directors and officers of financial companies. You can follow her on Twitter at twitter.com/naomisnyder or get connected on LinkedIn.