What Money Can Buy: How Market Exchange Promotes Values

This paper studies market participants’ concerns about the moral and social values of their counterparts in market exchange. Using a survey, a laboratory experiment, and an online experiment, we investigate whether consumers prefer to purchase from counterparts whose behavior indicates support for the consumers’ values—even when those values are orthogonal to the product or transaction—and whether sellers anticipate and respond to such concerns accordingly. We document two key findings supporting these relationships. First, we find that consumers prefer exchanging and are willing to pay more to exchange with counterparts whose actions express support for the consumers’ values, even when the consumers’ purchasing decisions have no instrumental impact on the promotion of those values. Second, when sellers anticipate the possibility of such exchange, they change their behavior to reflect greater support for the values held by buyers. Our findings thus question the typical assumption of impersonality in market exchange and suggest that the presence of opportunities for gain through market transactions may promote and shape the values that individuals publicly support.