Psychological Transactions
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When we lend to others, it can evoke feelings of kindness and empathy towards someone in need. Lending can be a way to show charity and build relationships and foster a sense of community. In some cultures, lending and gift-giving are considered essential components of social attachment and trust-creation.
However, lending can also come with emotional expenses and liabilities. When we lend money to someone, we are essentially investing in that person's well-being. When the loan is not repaid, it can lead to feelings of resentment and anger. This emotional response is often accompanied by feelings of powerlessness on others. It can be difficult to separate the emotional attachment from the economic transaction, making it challenging to navigate the repayment procedure.
On the other hand, borrowing money can have negative psychological effects on individuals. Borrowing can lead to feelings of shame and guilt. It can also create a sense of helplessness on others. When we borrow money, we are essentially surrendering control over our financial plans and submitting to someone else's conditions.
Interestingly, research has shown that the way we perceive borrowing and lending can be influenced by social norms and cultural values. In some cultures, borrowing money is considered a sign of personal failure. In others, it is seen as a necessary aspect of economic survival. These social norms can shape our attitudes towards lending and borrowing, as well as our expectations around restitution.
Another important psychological aspect of lending and borrowing is the concept of emotional conflict. When we lend or borrow money, we often experience conflicting emotions and thoughts. For example, when we lend money, we may feel generous and worried about the possibility of non-return. This dissonance can lead to feelings of anger.
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