Individuals who live in wealthy neighbourhoods are more likely to have materialistic values and poor spending habits, particularly if they are young, living in urban areas and relatively poor compared with their surroundings, scientists say.
The study from San Francisco State University is the first to show a connection between neighbourhood socioeconomic status and materialism.
The reason for the link, said co-author and SF State Associate Professor of Psychology Ryan Howell, may have to do with "relative deprivation," or the feeling someone gets when they believe they are less well-off than those around them.
If someone is bombarded with images or reminders of wealth, such as an abundance of investment banks nearby or neighbours driving luxury cars, they are likelier to feel a need to spend money they may not have to project an image of wealth they don't actually possess.
"People who live in more affluent areas are vulnerable to this implicit social comparison, where you start to see other people spending a lot of money," Howell said.
"Because you feel the need to live up to that standard, you end up impulsively buying material items, even though they don't actually make you happier," said Howell.
Researchers determined a neighbourhood's socioeconomic status by looking at its per-capita income and poverty rate as well as the number of financial institutions present.
That information was compared with survey data measuring participants' materialistic values, views about money and spending, and savings habits.
After controlling for age, gender and individual socioeconomic status, researchers found residents of wealthier neighbourhoods were likelier to be materialistic, spend compulsively and manage their money poorly than those living in less well-off areas.
The effect was seen especially in younger people, who Howell said tend to be more materialistic in general, those who live in urban areas, where residents are exposed to a larger socioeconomic spectrum, and those whose individual socioeconomic status is lower than their neighbourhood's.
Conversely, someone with a high individual socioeconomic status was less susceptible to such behaviour.
The study was published in the Journal of Consumer Culture.