Conspicuous Consumption: Buying Happiness and Success

The term 'conspicuous consumption' was coined in Thorstein Veblen's 1899 book The Theory of the Leisure Class. The term itself refers to the lavish spending on goods and services in order to display to others one’s personal income and wealth. Other theorists including Adam Smith and Karl Marx have argued that people choose to buy some goods because of what those goods reveal about their standing in society, not because of any intrinsic enjoyment they get from the purchase.

Veblen explains this idea of futility on page 20 stating, “Gentlemen of leisure, then, not only consume of the staff of life beyond the minimum required for subsistence and physical efficiency, but his consumption also undergoes a specialization as regards the quality of goods consumed. He consumes freely and of the best…” For example, a $20 Timex is capable of telling time just as well as a $2000 Tag watch, however one conveys an image of luxury and success while the other does not. A major motivation for buying an expensive watch is to signal to others that the one has ''made it,'' a point not lost on advertisers.

Where it was previously believed that the rich were most likely to engage in conspicuous consumption, economists Kerwin Charles, Erik Hurst and the professor of finance Nikolai Roussanov recent research argues that conspicuous consumption is more common among poorer groups of people and emerging economies. Virginia Postrel elaborates on the “wealth gap” between black and white Americans stating “African Americans not only had less wealth than whites with similar incomes, they also had significantly more of their assets tied up in cars. The statistic fit a stereotype reinforced by countless “bling”-filled hip-hop videos: that African Americans spend a lot on cars, clothes, and jewellery—highly visible goods that tell the world the owner has money.” Therefore visible luxuries and status symbol items serve less to establish the owner’s positive status as successful but rather fend off the negative connotation associated with being “poor” in today’s society. 

In closing, the best advise I found while researching this blog was this: if you want to live like a billionaire, buy a $12,000 bed, you can’t park a mattress in your driveway, but it will last for decades and you can enjoy it every night.

Postrel, V. (2008) Inconspicuous Consumption: A New Theory of the Leisure Class. The Atlantic. Retrieved from: http://www.theatlantic.com/magazine/archive/2008/07/inconspicuous-consumption/6845/

Veblen, T. (1899) Conspicuous Consumption. In Szeman, I., Kaposy, T. (2011) Culture Theory: An Anthology  (p. 18-26). Sussex, United Kingdom: Wiley-Blackwell