Conspicuous consumption

Tonight on National Radio (Radio New Zealand) Brian Crump had a very interesting interview with Dr Neville Bennett, economic historian, University of Canterbury – click here to download the interview. He talked about the change in conspicuous consumption and how people will start to cut back on their purchasing of luxury goods. Conspicuous consumption was introduced by economist and sociologist Thorstein Veblen in his 1899 book The Theory of the Leisure Class. It is a term used to describe the lavish spending on goods and services acquired mainly for the purpose of displaying income or wealth. In the mind of a conspicuous consumer, such display serves as a means of attaining or maintaining social status. A very comparable but more informal term is “keeping up with the Joneses”.

Why do people have this desire to acquire stuff – from the latest model of BMW to designer water?
Over the last three decades conspicuous consumption has accelerated at a phenomenal level in the industrial world. Self-gratification could no longer be delayed and an ever increasing variety of branded products became firmly ingrained within our individuality. The myth that the more we have the happier we become is self-perpetuating: the more we consume, the less able we are to tackle the myth. According to Neal Lawson – author of All Consuming – the central problem of a consumer society is that we might get wealthier, but not happier. Consumers have been competing against each other to gain an advantage. In a race that has no end. Ultimately the competition is about gaining happiness because of someone else’s unhappiness. He describes consumer society as the “the fine art of compensation, enough to reward us and keep our interest but not enough to stop us going back to the shops for more”. However, when is the amount stuff we accumulate enough? According the law of diminishing marginal utility we should find that the first purchase of a product gives us more satisfaction than the second. This means that even if we were to buy more we would look eventually to other ways of finding happiness. If we were to go on consuming we would have to move beyond physical needs to emotional desires.

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