Conspicuous Consumption and Thorstein Veblen's "Theory of the Leisure Class"

Readers, once again, thanks for indulging me as I take a break from writing to work on other projects. Here's a bit of an eggheaded (but surprisingly popular) post from four years ago. Enjoy!

Readers, if you've ever wondered why so many people presume that branded merchandise and high-priced consumer goods are somehow "better"--even when they're not--Thorstein Veblen gave us the answer back in 1899 in his seminal book The Theory of the Leisure Class:

"But the human proclivity to emulation has seized upon the consumption of goods as a means to an invidious comparison, and has thereby invested consumable goods with a secondary utility as evidence of relative ability to pay.

This indirect or secondary use of consumable goods lends an honorific character to consumption, and presently also to the goods which best serve this emulative end of consumption... The consumption of expensive goods is meritorious, and the goods which contain an appreciable element of cost in excess of what goes to give them serviceability for their ostensible mechanical purpose are honorific.

The marks of superfluous costliness in the goods are therefore marks of worth... This indirect utility gives much of their value to the 'better' grades of goods."

--Thorstein Veblen, The Theory of the Leisure Class

Veblen's writing is, uh, difficult (he was an academic and it showed), but his logic goes something like this: An item's price is a signal of your ability to pay, which is a signal of your wealth, which therefore signals your place in the dominance hierarchy of our society. The more needlessly expensive an item (its "superfluous costliness" as Veblen phrases it), the greater the wealth signal.

This is where Veblen came up with the now infamous phrase conspicuous consumption: consumption literally meant to be seen as overt demonstrations of social status and wealth.

In the modern era, we see this at every level of society. It exists at every branding tier and market segment of nearly every consumer product category. Every consumer goods retailer we shop at, every brand we choose, and practically every product we buy, collectively play some role in our identity construction and our place in society's status hierarchy.

Veblen then goes on to make an even more striking converse argument: Inexpensive consumable goods aren't just less expensive, they're also "cheap" in a deeply pejorative sense:

"While men may have set out with disapproving an inexpensive manner of living because it indicated inability to spend much, and so indicated a lack of pecuniary success, they end by falling into the habit of disapproving cheap things as being intrinsically dishonourable or unworthy because they are cheap."

The circularity here (as well as the financial waste) would be downright laughable if there weren't so many obvious examples of it in everyone's daily life. If you catch yourself presuming an expensive wine is better, that expensive branded products are better, or even that organic food is worth a large price premium, please recognize you're being played... by your own subconscious need for status.

Veblen takes the concept still further:

"So thoroughly has the habit of approving the expensive and disapproving the inexpensive been ingrained into our thinking that we instinctively insist upon at least some measure of wasteful expensiveness in all our consumption, even in the case of goods which are consumed in strict privacy and without the slightest thought of display. ...Any retrogression from the standard of living which we are accustomed to regard as worthy in this respect is felt to be a grievous violation of our human dignity."

Written a hundred years ahead of its time, this passage helps explain why so many middle- and upper-middle class Americans feel vaguely icky shopping at Wal-Mart, why they feel too culturally superior to go to chain restaurants, and why they pay significant price premiums for branded merchandise without even a second thought. Veblen saw it all more than a century ago: these things reflect our status.

We all like to think we don't buy things with our status in mind--that we're somehow above being so transparently status-conscious. But we do it without thinking, and worse, we rationalize it after the fact with plausible-sounding reasons justifying our actions. Of course the rationalizing is the most important step of all, because it protects us from truly seeing our own ugly status-consciousness for what it really is.

This neatly completes the circle of consumerism, to the intense delight of all the companies profiting from our freshly stroked egos.

One final thought. It's not a stretch to say that the average consumer hasn't read The Theory of the Leisure Class. It ain't exactly a page-turner, so I can see why. But how much would you bet that the people selling and marketing to us do know, intimately, all the concepts at work here?

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