A rational decision should result in the most optimal level of benefit for
an individual. While most conventional economic theories are created under
the rationality assumption, past research has shed light on irrational
behavior regarding income preference in the presence of social comparison.
Solnick and Hemenway found that individuals were willing to give up to 50%
of their income in *absolute terms* in exchange for higher *relative*
income than significant others.
This study (*N *= 314*)* examined which personal characteristics predict
such irrational behavior. Specifically, self-monitoring and
self-enhancement were hypothesized to be significant and positive
predictors for relative income preferences because such individuals are
more concerned with their expressive self-presentation and tend to ensure
desired public appearances. Moreover, I examined which social group is the
most important for income comparison. The results support the hypothesis
regarding self-monitoring and self-enhancement as predictors of relative
income preference and indicate co-workers to be the most important
comparison group.