Status and the Demand for Visible Goods: Experimental Evidence on Conspicuous Consumption

54 Pages Posted: 6 Dec 2015

See all articles by David Clingingsmith

David Clingingsmith

Case Western Reserve University

Roman M. Sheremeta

Case Western Reserve University

Date Written: December 4, 2015

Abstract

Some economists argue that consumption of publicly visible goods is driven by social status. Making a causal inference about this claim is difficult with observational data. We conduct an experiment in which we vary both whether a purchase of a physical product is publicly visible or kept private and whether the income used for purchase is linked to social status or randomly assigned. Making consumption choices visible leads to a large increase in demand when income is linked to status, but not otherwise. We investigate the characteristics that mediate this effect and estimate its impact on welfare.

Keywords: status, conspicuous consumption, experiment

JEL Classification: C91, D03

Suggested Citation

Clingingsmith, David Lawrence and Sheremeta, Roman M., Status and the Demand for Visible Goods: Experimental Evidence on Conspicuous Consumption (December 4, 2015). Available at SSRN: https://ssrn.com/abstract=2699325 or http://dx.doi.org/10.2139/ssrn.2699325

David Lawrence Clingingsmith (Contact Author)

Case Western Reserve University ( email )

Cleveland, OH 44106
United States

Roman M. Sheremeta

Case Western Reserve University ( email )

10900 Euclid Ave.
Cleveland, OH 44106
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
160
Abstract Views
1,188
Rank
334,612
PlumX Metrics