Costly Signalling

I just finished an intriguing book called Spent by Geoffrey Miller. I recommend it. In some ways the book is all over the place, covering more topics that it probably should, but to a patient and accommodating reader it offers plenty of useful insights.

One of the central themes of Spent is the idea of observing consumer behavior through the lens of evolutionary psychology. We all know that consumers buy things to "signal" desirable qualities and traits. This in itself is not a new idea--after all, Thorstein Veblen covered it in sarcastic detail in The Theory of the Leisure Class back in 1899. Heck, for that matter, Diogenes saw it back in 400 BC. We signal to the people around us that we are "fit" in the evolutionary sense: fit to be friends or peers, fit to be colleagues, fit to be a member of whatever tribe we're in, fit to be a mate, and so on.

The consumer marketplace gives us all kinds of methods to engage in signalling. We can signal wealth by buying expensive cars, clothes and houses. We can signal intelligence by buying shelfloads of books, or by name-dropping the Ivy League university where we got our MBA. We can signal environmental conscientiousness by waxing rhapsodic about the organic, fair trade bulgur we bought at that family-owned health food store in town.

Unfortunately, it can get awfully expensive to do all this signalling. What if, instead, we were to look at signalling activity from the perspective of consumer empowerment?

One thing to consider: If you think about it, all signals given via purchases made in the consumer marketplace are essentially... facades. Returning to our luxury car example, let's say you buy an expensive car to signal economic fitness, and by doing so you successfully attract many mating partners and friends.

Here's one problem that comes to mind right away: you will have attracted the kind of people who judge you by the car you drive.

That's bad enough... but there's an even bigger problem. Your actual economic fitness will become quickly obvious to all of those mating partners and friends once they actually get to know you. The whole point of attracting friends and mates is for them to know the real you, right? So when they find out (and they will find out) that you can barely swing your monthly lease payment, and that your "wealth signal" was totally phony, your facade instantly crumbles away, and these alleged friends and mates (who you attracted under essentially false pretenses) will neither care about your nor the luxuriousness of your car.

All facades crumble. Better to have built true financial fitness instead--by not buying that car in the first place.

In fact, taking this one step further, you could argue that a sophisticated observer of consumer behavior could judge an expensive car as a signal of anti-fitness. The signal of always driving late-model luxury automobiles, viewed across a person's entire lifetime, might represent not wealth, but the waste of hundreds of thousands of dollars of personal financial capital! This is a second-order insight you might distill from, say, books like The Millionaire Next Door or Your Money Or Your Life.

Now, in the archives of Casual Kitchen, we've written about the idea of driving old cars as an act of mini-rebellion against consumerism, against financial waste, and against the idea of raising the bar of status competition for the people around us. But as much as we anticonsumerists like to think we're above base displays of fitness signalling, these things are acts of signalling too.

What driving an old and highly practical car signals, I'm not quite certain. I'd like it to signal something along the lines of "I have the confidence to drive an old car and not worry about what people think." But then again, perhaps it signals "I'm slightly dull." Or "I'm slightly dull, thus I am unlikely to get pec implants and a mistress, therefore I am signalling I would be a very steady and economically desirable mate." It's hard to say.

Of course, I'm not judging any of these signals in the least (really, I'm not!). What I want to illustrate is that this signal--uh, whatever it happens to mean--costs a lot less to put out there than a lifetime of buying late-model luxury cars. A whole heck of a lot less.

The point here is to be aware not only of trait signalling, but also to be aware that we all do it--even if we'd like to think we don't. As "hypersocial status-seeking primates" as Spent's author Geoffrey Miller would phrase it, we are genetically built to signal. In fact, the entire reason we're even here talking about this topic in the first place was because our genes successfully signaled fitness over time, and thus survived to the present day.

The empowered consumer, then, finds a way to signal the right kinds of fitness without resorting to buying things in the consumer marketplace. Those signals are the costliest--and the most transparently artificial.

So what signals are you giving off by the purchases you make? Or, more importantly, the purchases you don't make?

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chacha1 said...

Hi Dan! I've been a ghost lately. This post reminded me of a thought I had recently: if you are driving your late-model luxury car (up to and including Tesla, Maserati, & Bentley) to a job every day - where you work for somebody else and get stressed out about getting there after 9 a.m. - you are doing it wrong.

Daniel said...

Yep. That would be a pretty transparent facade, wouldn't it? Thanks as always for reading and commenting Chacha!!