Why Do We Spend So Much Money on Our Pets? Behavioral Economics Explains

We pour money into our pets because we love them like family.

In 2024, Americans spent a whopping $151 billion on pet care, from food to vet bills, far more than the $35 billion on TV streaming or the $25 billion on spectator sports.

This isn’t just about necessity; it’s about the joy and companionship pets bring, with 97% of pet owners seeing them as family members, and half considering them as important as human relatives.

Key Points

Research suggests we spend a lot on pets due to strong emotional bonds, viewing them as family.
It seems likely that behavioral biases, like valuing identifiable pets more, drive higher spending.
The evidence leans toward pet spending, at $151 billion in 2024, far exceeding the $7–8 billion donated to animal protection.

Behavioral Biases and Pet Speciesism

Our spending is influenced by pet speciesism, a bias favoring pets over other animals. Studies show we prefer saving a dog over a pig, especially when emotions guide decisions, not logic.

This bias, rooted in behavioral economics, means we value our own pets more due to the identifiable victim effect—we see their immediate needs and act on them, unlike broader animal causes.

Comparing to Animal Protection

While we lavish cash on our pets, donations to animal protection lag at $7–8 billion annually, showing a stark contrast.

This gap likely stems from the personal, direct impact of pet spending versus the less tangible benefits of donations, highlighting how our emotional connections shape financial choices.

Detailed Analysis of Pet Spending and Behavioral Economics

This article delves into the reasons behind the significant expenditure on pets, exploring the concept of pet speciesism and its implications through the lens of behavioral economics.

Drawing from recent data and academic studies, we aim to provide a comprehensive understanding, challenging common assumptions and offering detailed insights into consumer behavior.

The analysis is grounded in 2024 statistics and theoretical frameworks, ensuring a thorough examination of this phenomenon.

Understanding Pet Spending and Pet Speciesism

Pet spending in the United States reached $151 billion in 2024, according to the American Pet Products Association, a substantial increase from $70 billion in 2017. This figure includes expenditures on food, supplies, veterinary care, and luxury items, reflecting a growing trend in pet ownership.

Pet speciesism, as described by Lucius Caviola and Valerio Capraro in their 2020 paper in Social Psychology and Personality Science, is a moral bias favoring companion animals over non-companion species, such as preferring to save a dog over a pig, a preference at least as strong as saving a human over a chimpanzee.

This bias is particularly pronounced when decisions are emotion-driven, as noted in the study, aligning with findings in behavioral economics that emotions and cognitive biases significantly influence human decision-making.

Daniel Kahneman, in his book Thinking, Fast and Slow, reported a study where donations to save oil-covered sea birds decreased from $80 for 2,000 birds to $78 for 20,000 birds, illustrating how perceived impact affects giving, a concept relevant to pet spending versus broader animal welfare donations.

Emotional Attachment and Humanization of Pets

The emotional bond with pets is a primary driver of high spending. According to the Pew Research Center, 97% of American pet owners consider their pets family members, with half viewing them as equally important as human relatives.

This humanization of pets, a term gaining traction since the 1990s as shown in an Ngram Viewer graph by Hal Herzog, has economic ramifications, with more households including pets than children, as reported by the same Pew study.

This emotional connection leads to spending on pet care, such as veterinary services and luxury items, seen as direct investments in family well-being.

For instance, a Tennessee law limits liability damages for a pet’s death to $5,000, yet a Connecticut jury awarded $200,000 for a St. Bernard’s death, reflecting the perceived value of pets, as discussed by Daniel Ariely in Predictably Irrational, highlighting our “predictable irrationality” in valuing pets.

Behavioral Economics and Spending Patterns

Behavioral economics provides insights into why pet spending outpaces donations to animal protection. The identifiable victim effect, where people are more likely to help a specific individual they can relate to, explains why we spend more on our own pets than on abstract causes.

The endowment effect, where we overvalue what we own, further amplifies this, as pet owners see their pets as irreplaceable, leading to higher expenditures.

Data from Andrew Rowan’s report, commissioned by Animal Grantmakers, and cited in the original article, shows Americans donate $7–8 billion annually to animal protection, compared to $151 billion on pets, a ratio of about 20:1.

This disparity is evident in graphs by Hal Herzog, illustrating the soaring pet spending versus charitable giving to environmental and animal causes, which increased from $2 billion in 1987 to $14 billion in 2021 in inflation-adjusted dollars, as per Rowan’s analysis.

Comparing Pet Spending to Other Expenditures

To contextualize, pet spending of $151 billion in 2024 is three times the $35 billion revenue from subscription video-on-demand services in 2023, as per Statista, and six times the $25 billion spectator sports industry revenue in 2023, according to IBISWorld.

This comparison, while the article mentioned ten times for sporting events, likely refers to a narrower category, but underscores pets as a significant expenditure, akin to hobbies ($45 billion in 2022) and recreation ($173 billion in 2022), as per the Sports & Fitness Industry Association and Bureau of Economic Analysis.

Challenging Common Assumptions: The Disparity with Animal Protection

A common assumption is that pet owners, given their love for animals, would equally support animal protection causes. However, the data suggests otherwise.

The $7–8 billion in donations, while significant, pales compared to pet spending, possibly due to the direct, immediate impact of pet care versus the perceived distant impact of donations, as seen in Kahneman’s bird study.

This aligns with the concept of moral licensing, where pet owners might feel their care for their pet fulfills their animal welfare obligations, reducing donation incentives, as discussed in studies like Journal of Consumer Marketing.

Practical Implications and Broader Context

For pet owners, recognizing this bias can inform more balanced resource allocation, such as supporting animal welfare organizations like Giving USA, which reported $4.74 billion in 2022 donations to animal and wildlife causes, though Rowan’s higher estimate suggests broader inclusion.

Marketing by the pet industry, promoting high-end products, further encourages spending, as noted in Journal of Business Research, where anthropomorphism increases willingness to spend.

This analysis suggests that while pets provide emotional and social benefits, the disparity in spending reflects deeper psychological and economic factors, challenging us to consider our moral obligations to all animals, as Peter Singer argued in Animal Liberation, advocating for equal ethical footing across species, contrasting with George Orwell’s view in Animal Farm that “some animals are more equal than others.”

Table: Comparison of Pet Spending and Related Expenditures (2024 Data)

Category	Annual Spending (Billions USD)	Notes
Pet Care	151	Includes food, vet care, supplies, luxury items
TV Streaming Services	35	Subscription video-on-demand revenue, 2023 data
Spectator Sports	25	Industry revenue, 2023 data
Hobbies	45	2022 data, includes equipment and activities
Recreation & Entertainment	173	2022 data, broad category including sports and leisure
Animal Protection Donations	7–8	Estimated annual donations, includes welfare and rights

This table highlights the significant allocation to pets compared to other discretionary spending, illustrating the economic impact of pet speciesism.

Conclusion

In summary, we spend extensively on pets due to emotional attachment, humanization, and behavioral biases favoring identifiable, personal connections. The $151 billion in 2024 pet spending far exceeds the $7–8 billion in animal protection donations, reflecting pet speciesism and the tangible impact of pet care.

This disparity challenges us to balance personal pet investments with broader animal welfare support, acknowledging the complex interplay of emotions and economics in our choices.