Economic hardship and neighborhood diversity: Influences on consumer well‐being

• Published date: 01 December 2021
• Author: Chan‐Hoong Leong,Soo Jiuan Tan,Elizabeth A. Minton,Siok Kuan Tambyah
• Date: 01 December 2021
• DOI: http://doi.org/10.1111/joca.12365

SPECIAL ISSUE

Economic hardship and neighborhood diversity:

Influences on consumer well-being

Chan-Hoong Leong

1

|SooJiuanTan

2

| Elizabeth A. Minton

3

|

Siok Kuan Tambyah

2

1

Centre for Applied Research, Singapore

University of Social Sciences, Singapore,

Singapore

2

Department of Marketing, NUS Business

School, National University of Singapore,

Singapore, Singapore

3

Department of Management &

Marketing, College of Business,

University of Wyoming, Laramie,

Wyoming

Correspondence

Chan-Hoong Leong, Singapore University

of Social Sciences, Singapore, Singapore.

Email: chleong@suss.edu.sg

Funding information

National University of Singapore

Abstract

Residential neighborhoods shape consumers' well-being

in many profound ways. However, research has yet to

adequately understand how consumers' perceived eco-

nomic hardship interact with neighborhood's income and

diversity to influence well-being. We examine these

effects in a diverse and densely populated Asian country

of Singapore using four measures of well-being: perceived

quality of life, emotional well-being, status consciousness,

and consumer needs satisfaction. Results from a national

sample of 1,445 respondents showed that consumers that

were female rather than male, of immigrant origin rather

than native born, representing an ethnic minority back-

ground, or had fewer economic challenges reported

higher well-being. The relation between economic hard-

ship and consumer well-being was moderated by

neighborhood-level socioeconomic status (SES) and diver-

sity, such that more economic hardship predicted lower

well-being but only among residents in low SES or het-

erogeneous neighborhoods. Findings build on social com-

parison theory, and implications for consumer welfare

and marketing practice are provided.

KEYWORDS

consumer well-being, neighborhood diversity, social

comparison theory

Received: 30 October 2019 Revised: 27 October 2020 Accepted: 28 January 2021

DOI: 10.1111/joca.12365

Copyright 2021 by The American Council on Consumer Interests

1226 J Consum Aff. 2021;55:1226–1248.wileyonlinelibrary.com/journal/joca

The literature on how neighborhoods shape behaviors and well-being can be traced to research

on geographic determinism, where the spatial environment—be that people, culture, or

climate—is said to predispose individuals and communities to certain developmental pathways

(Semple, 1911). This framework underpins the primordial writings in anthropology and human

geography, and in subsequent years, research in urban studies, criminology, sociology, health

psychology, and of course, consumer behavior as well. The taxonomy of a neighborhood has

multiple facets, and it can be distilled according to the built (e.g., location, amenities) and social

environment (e.g., concentrated poverty, socio-economic status, racial diversity, inequality)

where both influence a plethora of consumer well-being outcomes. With that being said, little

research has examined the influence of a consumer's neighborhood on their well-being and

consumption practices. Such an understanding is critical given the ease in targeted marketing

communications to specific neighborhoods as well as the large real estate industry.

Empirical evidence has generally dovetailed to similar conclusions—places that promote

interactions and security have a positive effect on consumers' civic engagement as well as men-

tal and physical well-being. Access to facilities (Nyunt et al., 2015), places of worship (Roman

and Moore, 2004), connected street networks (Wood et al., 2008), mixed-use development

(Leyden, 2003; Richard et al., 2008; Leyden and Goldberg, 2015), and neighborhoods with

higher homeownerships (Rahimi et al., 2017) are linked to active participation and interper-

sonal trust among residents in the neighborhoods. In contrast, proximity to dysfunctional street

frontages, such as graffiti, noise, dirt, vandalism, and drug abuse, lead to distrust and fear (Ross

and Jang, 2000; Ross et al., 2002). Additionally, living in densely populated regions negatively

influence a consumer's social network and well-being (Cramer et al., 2004).

However, the literature examining the influence of neighborhoods on well-being is primar-

ily informed by empirical studies in Europe and America, and to the best of our knowledge,

only a handful have investigated metropolitan Asian cities (e.g., Nyunt et al., 2015; Guo

et al., 2018). Identifying the influence of neighborhoods on consumer well-being is particularly

important in the diverse and fast changing countries of Asia because Asia is the world's most

populous continent (representing 59.55% of the world's population), covers the greatest land

mass (over 17 million square miles), and has the highest population density (246.11 people per

square mile) (World Atlas, 2018). This large population density brings about more intense inter-

actions between people at the community level, as the urban spatial structure in densely popu-

lated cities like Singapore evolve to be ever more polycentric, heterogenous, and complex

(Zhong et al. 2014). Residents move around their local areas more intensely for their daily eco-

nomic and social needs, as the neighborhoods emerge as a new, compact geographical node for

socialization. This is particularly so in Singapore, which is ranked by the World Bank to have

one of the highest population densities among economies and countries, with 7,952.99 people

per square kilometer (World Bank, 2020).

Building off this, we seek to understand how neighborhood characteristics—measured in

terms of absolute and relative SES conditions—moderate the effect of consumer economic hard-

ship on well-being. To provide greater contribution to the consumer behavior literature, we

examine well-being across four different factors: perceived quality of life, emotional well-being,

status consciousness, and consumer needs satisfaction. We propose that neighborhood charac-

teristics provide a mechanism facilitating upward comparisons for consumers facing economic

hardship, which thereby decreases consumer well-being. In accordance with social comparison

theory (Suls and Wheeler, 2013), we suggest that this relationship occurs because consumers

realize that they are distinct from neighborhood peers that are more well-off or similar in terms

of their financial standing. Expanding on our brief comment earlier, examining the influence of

LEONG ET AL.1227