The focus of the Month: Air Pollution as a critical factor for the consumer decision-making behavior

With the significant spread of global urbanization and industrialization, air pollution has become a global social problem. Recent scientific studies show that air pollution not only has an important impact on consumers’ physical health but also has a significant impact on consumers’ decision-making behavior. For example, air pollution can reduce consumers’ emotional state and be a trigger a variety of negative emotions, and such changes in emotions can significantly affect consumers’ decision-making behavior. Specifically, air pollution, for example, can significantly affect the sales of insurance. In our new column called ‘Focus of the Month,’ we shall analyze deeply the marketing science. And today’s focus will be totally on the correlation between air pollution and consumers’ decision-making process.

Due to air pollution, consumers’ decision-making process goes through many changes, mainly reflected in physiological and psychological changes.

Physiological Effects of Air Pollution on consumers’ decision-making process

Air pollution damages consumers’ physical health. On the one hand, it increases the morbidity and mortality of consumers, such as damage to the respiratory tract, affecting the incidence of cardiovascular diseases, etc. On the other hand, it affects consumers’ nervous system and cognitive function, which eventually affects consumers’ cognitive ability and judgment ability in daily life and consumption.(Calderón-Garcidueñas, L., Kulesza, R. J., Doty, R. L., 2015).

Psychological Impact of Air Pollution on consumers’ decision-making process

Air pollution brings immediate and short-term effects to consumers, such as affecting their emotions and feelings; For example, Marques and Lima (Marques, S., Lima, M. L., 2011) found that people living in industrial areas with high levels of air pollution had higher rates of anxiety and depression than the general population. Such emotional changes caused by air pollution will further affect consumers’ feelings and emotional experiences, leading to a decline in consumers’ life satisfaction and happiness. Additionally, it affects consumers’ happiness expression on social media. Moreover, Zheng,(Zheng, S., Wang, J., Sun, C., 2019) based on 210 million pieces of social media data from 144 cities, found that air pollution levels are significantly negatively correlated with residents’ happiness expressed on social media.

The psychological Impact of Air Pollution on consumers’ decision-making process is heterogeneous

The researchers noticed that the psychological impact of air pollution on consumers is heterogeneous and varies among different consumers and groups. In terms of consumer groups, Yang Jidong and Zhang Yiran (Yang, J-D., Zhang, Y-R., 2014) found that air pollution had a more significant impact on happiness among low-income groups, males, and rural residents. Additionally, Zheng et al. (Zheng, S., Wang, J., Sun, C., 2019) found that women were more vulnerable to air pollution and the psychological impact of air pollution was stronger on weekends, holidays, extreme weather conditions, and in cities with the lowest and highest AIR pollution indexes.

The effects of air pollution on consumers’ daily decision-making behavior

Several studies have looked at the impact of air pollution on consumers’ daily decision-making behavior and indicated that air pollution causes consumers to have certain avoidance behaviors. For example, consumers may reduce unnecessary traffic trips, take protective measures, or even move to cities with better air quality, as well as cut back on outdoor activities. Consumers also take certain precautions to mitigate the effects of air pollution, such as wearing face masks. Such changes may lead consumers to reduce the consumption of public welfare products, consider fewer factors such as charity and altruism in their consumption decisions, and are more likely to choose to buy immoral products, such as pirated software and pirated records. The research conducted by Rotton.J, (1979) has shown experimentally that air pollution can increase aggression in individuals. And this specific change can lead to playing more aggressive games, such as shooter games.

The effects of Air Pollution at the group level

Existing studies generally agree that air pollution affects stock markets in developed countries and regions. However, many scholars’ research conclusions on the impact of air pollution on stock markets in developing countries and regions are inconsistent. The main research focused on two countries: China and Turkey.

Based on data from China, Levy and Yagil (Levy, T., Yagil, J., 2011) showed a negative correlation between air pollution and the stock market. However, some studies suggest that air pollution does not consistently affect stock markets. The results of Demir and Ersan’s (2016) study show that air pollution lag is negatively correlated with stock returns in Turkey’s three most populated cities, but in other cities, there is no such relationship between air pollution and the stock market.

Air pollution may affect the fresh food market trade in the short term. Sun et al. (2017) believed that air pollution would affect the market trade of fresh food in the short term. For example, they found that air pollution could significantly reduce the price of vegetables, but had no significant impact on the price of pork. Air pollution also has an impact on the medical market, which could increase sales in the pharmaceutical market.

The effects of Air Pollution at the individual level

The negative psychological effects caused by air pollution will also affect consumers’ consumption decisions. For instance, the negative emotions caused by air pollution will affect consumers’ investment decisions. Air pollution will increase consumers’ spending on health, such as consuming more air pollution protection products, increasing medical expenses, and purchasing health insurance. On the other hand, Li et al. believed that air pollution levels would have a negative impact on the sales of cars with low fuel efficiency. The research of Dagher and Itani (2014) shows that consumers’ perception of the severity of environmental problems has a positive impact on green purchasing behavior. In addition, consumers will also avoid air pollution and reduce consumption. Zheng Siqi showed that air pollution would reduce the frequency of residents eating out.

List of literature

Qi Qiu,Yani Wang,Shi Qiao,Rong Liu ‘Does air pollution affect consumer online purchasing behavior?’

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