Conspicuous consumption dynamics

B-Tier
Journal: Games and Economic Behavior
Year: 2008
Volume: 64
Issue: 1
Pages: 121-145

Authors (2)

Friedman, Daniel (University of Essex) Ostrov, Daniel N. (not in RePEc)

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We formalize Veblen's idea of conspicuous consumption as two alternative forms of interdependent preferences, dubbed envy and pride. Agents adjust consumption patterns gradually, in the direction of increasing utility. From an arbitrary initial state, the distribution of consumption among agents with identical preferences converges to a unique equilibrium distribution. When pride is stronger, the equilibrium distribution has a right-skewed density. When envy is stronger, the equilibrium is concentrated at a single point, and the adjustment dynamics involve a shock wave that can be interpreted as a growing, moving, homogeneous "middle class."

Technical Details

RePEc Handle
repec:eee:gamebe:v:64:y:2008:i:1:p:121-145
Journal Field
Theory
Author Count
2
Added to Database
2026-01-25