Positional Goods and Social Welfare: A Note on George Pendleton Watkins' Neglected Contribution

Forthcoming, The European Journal of the History of Economic Thought (2018)

9 Pages Posted: 14 Aug 2018

See all articles by Luca Fiorito

Luca Fiorito

University of Palermo

Massimiliano Vatiero

University of Trento - Department of Economics and Management; Università della Svizzera italiana

Date Written: February 2, 2018

Abstract

This paper deals with the analysis on adventitious utility—that contains many aspects that are connected to the contemporary debate on positional goods—of the early twentieth century American economist, largely forgotten today, George Pendleton Watkins. According to the author, adventitious utility emerges from a process of social exclusion which can create negative externalities, in the sense that positive consumption of one individual implies negative consumption by another individual. Interestingly, a similar notion of positional competition as a zero-sum game has gained some consensus among contemporary authors (Pagano 1999; Hopkins and Kornienko 2004). In addition, for Watkins striving for adventitious utility does undermine social welfare. Not only it worsens both individual and social well-being by generating social waste, but it also disrupts the integrity of the social fabric. In discussing possible remedies, Watkins pointed out the necessity of a more egalitarian distribution of income and postulated a dichotomy between goods and services possessing adventitious utility and those possessing what he defined as multiple utility. In the latter group Watkins included public goods as well as those dimensions in human consumption that depend on social interaction and can be enjoyed only if shared in community.

Suggested Citation

Fiorito, Luca and Vatiero, Massimiliano, Positional Goods and Social Welfare: A Note on George Pendleton Watkins' Neglected Contribution (February 2, 2018). Forthcoming, The European Journal of the History of Economic Thought (2018). Available at SSRN: https://ssrn.com/abstract=3221611

Luca Fiorito

University of Palermo ( email )

Viale delle Scienza
Palermo, 90128
Italy

Massimiliano Vatiero (Contact Author)

University of Trento - Department of Economics and Management ( email )

Via Inama 5
Trento, I-38100
Italy

Università della Svizzera italiana ( email )

Via Giuseppe Buffi 13
Lugano, Ticino 6900
Switzerland

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