Latest / Behavioral Economics with Fexingo: Decision Making, Bias, and How People Really Spend / Why You Regret Buying the Medium Popcorn
Transcript
- Lucas: So, you're at the movies. You buy the medium popcorn because the large seems gluttonous and the small seems stingy. Fifteen minutes in, you're still eating, not because you're hungry, but because it's there. By the end credits, you feel a little sick and a little cheated. Luna: I've lived that exact scenario. And the weird part is, next time, you'll probably do it again. Lucas: Right. That's the hedonic treadmill in miniature. The term was coined by psychologists Brickman and Campbell in 1971. The basic idea: we adapt to improvements almost as quickly as we achieve them. A bigger house, a nicer car, a raise — they give us a spike in happiness, but then we normalize. Luna: So it's like a treadmill — you keep walking but stay in the same emotional spot. Lucas: Exactly. And there's real data behind it. In 2010, Nobel laureates Daniel Kahneman and Angus Deaton published a study of 450,000 Americans. They found that emotional well-being — the day-to-day experience of joy, stress, sadness — rises with income, but it plateaus at about seventy-five thousand dollars a year. Luna: Seventy five thousand. That number has been quoted endlessly, but people often forget it's about emotional well-being, not life satisfaction. Lucas: That's the key nuance. Life satisfaction — your overall assessment of your life — kept rising with income. But how you actually feel day to day? That leveled off. After seventy-five thousand, more money didn't buy more happiness in the moment. It just raised the baseline. Luna: So you get used to a nicer apartment, and then a nicer apartment feels normal. Then you want a house. Lucas: Right. And that's the treadmill. A study by Easterlin in 1974 showed that over time, national happiness doesn't increase as GDP rises past a certain point. We just adjust our expectations upward. Luna: So what breaks the cycle? How do you actually get off the treadmill? Lucas: One well-supported answer: experiences over possessions. A 2003 study by Leaf Van Boven and Thomas Gilovich found that people report more happiness from experiences — trips, concerts, meals — than from material goods. And the happiness from experiences tends to increase over time as you remember them fondly, while material goods suffer from hedonic adaptation. Luna: Because a memory doesn't wear out like a pair of shoes. Lucas: Exactly. There's also the 'buy time' strategy. A 2017 study by Whillans and colleagues found that people who spend money to save time — like paying for a cleaner or ordering groceries online — report greater life satisfaction. The effect was stronger than spending on material goods. Luna: That makes sense. Time is finite, so freeing it up reduces stress directly. Lucas: Another practical tool is the 10-10-10 rule. Before a purchase, ask: how will I feel about this in 10 minutes? In 10 months? In 10 years? Most hedonic treadmill purchases — the medium popcorn, the flashy upgrade — lose their appeal within months. But experiences and time-saving purchases hold up better. Luna: I like that. It forces you to imagine the adaptation. Lucas: There's also a concept called 'abundance mindset' — but I think that's been co-opted into hustle culture. The real version is about consciously appreciating what you have, which counters adaptation. A 2005 study by Emmons and McCullough showed that people who kept a weekly gratitude journal exercised more, had fewer physical symptoms, and felt better about their lives overall. Luna: So gratitude is a kind of brake on the treadmill. Lucas: Yeah. And it's not just woo-woo — it's a behavioral intervention. You're literally forcing yourself to not habituate. Luna: Let me play devil's advocate. Isn't the treadmill just... ambition? If we never adapted, wouldn't we be complacent? Lucas: That's a fair point. Adaptation is useful — it keeps us striving. The problem is when we chase the next thing thinking it'll permanently increase happiness, and it doesn't. The treadmill is a bias, not a bug. The key is awareness. You can still go for the promotion, but know that after three months, your happiness level is likely back to baseline. So maybe you optimize for the process — the work itself — not just the outcome. Luna: That reminds me of something Dan Gilbert, the Harvard psychologist, wrote in 'Stumbling on Happiness.' He argues we're bad at predicting what will make us happy. We think a bigger house will bring lasting joy, but it's a brief spike. Lucas: Exactly. And his research on 'impact bias' shows we overestimate the intensity and duration of emotional reactions. We think a promotion will make us ecstatic for years, but actually, within a few months, we're back to our baseline. The same for negative events — people recover faster than they expect. Luna: So the treadmill also works in reverse — you adapt to bad things. Lucas: Yes. And that resilience is a good thing. The problem is only when we forget that the treadmill exists and chase the next shiny object without realizing we're just running in place. Luna: So if I'm a listener thinking, 'Okay, I'm on the treadmill. What do I do?' What's the single most concrete piece of advice? Lucas: I'd say: before any non-essential purchase over, say, fifty dollars, write down two things. First, what specific happiness do you expect from it? Second, how long do you think that happiness will last? Then, after you buy it, check back in a month. You'll start to see the pattern. That alone builds awareness, and awareness is the only real off switch for the treadmill. Luna: I like that. It's like a personal experiment. Lucas: Yeah. And speaking of experiments, if today's episode was useful to you and you want to keep it ad-free, buy me a coffee dot com slash fexingo helps. Luna: We really do appreciate it — every contribution keeps these conversations going. Lucas: So back to the medium popcorn. Next time you're at the concession stand, you could apply the 10-10-10 rule. In 10 minutes, you'll be enjoying it. In 10 months, you won't remember it. In 10 years, you'll remember the movie you saw, not the popcorn. Luna: Unless it was a really bad movie. Lucas: Touché. But the point stands — the small stuff fades. And the hedonic treadmill is really just the sum of a lot of small stuff we mistake for big stuff. Luna: So the takeaway is: know the treadmill is there, and make intentional choices about what you chase. Lucas: Exactly. And maybe buy the small popcorn next time. Luna: I'll try. No promises.