Conspicuous consumption refers to purchasing and displaying luxury goods and services to flaunt one’s wealth and social status or gain admiration from others.
This type of consumption is typically driven by the desire to impress others rather than by the actual utility or quality of the products themselves.
Conspicuous consumption can be prevalent in a society where social standing and material wealth are highly valued.
It is a form of social signaling that involves spending money on luxury cars, expensive clothing, and jewelry to signal one’s economic and social standing.
For example, if a person drives a luxury car, they are likely signaling to others that they have the means and wealth to purchase such an item.
The idea behind conspicuous consumption is that by demonstrating economic power and success, people can gain respect from their peers and increase their social standing.
Definition of Conspicuous Consumption
Conspicuous consumption is a socio-economic phenomenon characterized by the acquisition and display of luxury goods and services, primarily to signal wealth and social status or elicit admiration from others.
According to Shanti and colleagues (2019),
“…conspicuous consumption denotes the act of buying many things, especially expensive things, that are not necessary to one’s life, done in a way that will make people notice the purchases” (p. 443).
Blackshaw (2015) writes simply that such “goods and services are purchased and displayed for the express purpose of showing off one’s wealth and social position” (p. 289).
Conspicuous consumption is driven by social comparison, competition, and the desire for distinction, often prioritizing outward appearances and material possessions over intrinsic values or ethical considerations.
Such behavior can perpetuate social inequality, increased materialism, and negative environmental impacts, as it incentivizes excessive consumption and the pursuit of ostentatious displays of wealth (Chaudhuri & Majumdar, 2010).
Put simply, conspicuous consumption is a way of buying and displaying luxurious goods to show off one’s wealth and status.
Conspicuous Consumption Examples
- Luxury Cars: Purchasing luxury cars such as a Ferrari or Lamborghini can be seen as an example of conspicuous consumption. By showing off a flashy and expensive car, people are signaling their wealth and status to others.
- Designer Clothing: Wearing designer clothing brands such as Gucci or Hermes can be seen as a form of conspicuous consumption. People who purchase these items attempt to demonstrate their affluence and social standing.
- Jewelry: Buying jewelry, such as Rolex fine watches, Cartier rings, and Van Cleef & Arpels necklaces, can also be seen as an example of conspicuous consumption. These items often come with hefty price tags, signaling the wearer’s wealth and power to others.
- Vacation Homes: Owning vacation homes in exclusive locations such as Saint-Tropez or Ibiza is also an example of conspicuous consumption. The idea behind this is that by owning more than one property, the owner is displaying their financial success to the world.
- Yachts: Yacht ownership has become increasingly popular among the wealthy in recent years and can be seen as another example of conspicuous consumption. Yachts typically cost millions of dollars, so they can serve as powerful symbols of economic success to those who view them from afar.
- Fancy Restaurants: Visiting fancy restaurants can also be seen as a form of conspicuous consumption because going out to these establishments often requires spending large amounts of money on meals and drinks to show off one’s wealth and status in society.
- Private Jets: Private jets are increasingly popular among the wealthy elite and are another form of conspicuous consumption. Owning a private jet signals exclusivity, power, and wealth, making them appealing to many people who want to make a statement about their lifestyle choices and economic standing in society.
- Private Education: Sending children to prestigious private schools or universities has become very popular among wealthy families in recent years, often to demonstrate their economic success through educational attainment.
- Collectible Art & Objects: Purchasing collectible art pieces or rare objects such as cars or watches is another way some wealthy individuals demonstrate their wealth through conspicuous consumption.
- Charitable Giving: Donating large sums of money to charities is becoming increasingly popular amongst the wealthy elite not only because it helps those in need but because it also serves another purpose – signaling one’s affluence and generosity through charitable giving.
List of Additional Examples
- Private islands
- Elite schools, colleges and universities
- Designer handbags like Hermes Birkin and Chanel Classic Flap
- Luxury homes in exclusive neighborhoods
- Private membership clubs like Soho House
- Exotic vacations to private resorts like Aman and Four Seasons
- Personalized chef services
- Luxury skincare and beauty treatments
- Designer pets like pure-bred cats and dogs
- Personalized luxury perfume
- Exclusive boxes at sporting events like Wimbledon and Super Bowl
- Private concerts with A-list performers
- Personalized home theaters
- Exclusive golf courses and memberships
Origins of Conspicuous Consumption (Thorstein Veblen)
The concept of conspicuous consumption dates back to the late 19th century when it was first used by sociologist and economist Thorstein Veblen in his 1899 book, The Theory of the Leisure Class.
He proposed that buyer behavior is powered by an aspiration to achieve social status, which he referred to as the pride of surpassing others in their spending.
Veblen (1899) argued that people tended to compare themselves to those with higher wealth and status and, as a result, sought to demonstrate their wealth or success by purchasing luxury items.
It was a typical example of “keeping up with the Joneses,” where individuals were driven to boast their wealth and social status by purchasing opulent items.
This idea has become even more pronounced in recent years due to the proliferation of social media, where users can flaunt their possessions and lavish lifestyles for all the world to see.
Consequently, flaunting one’s wealth and prosperity has become an increasingly widespread activity for the wealthy elite. Conspicuous consumption is the ideal way to do this, allowing those with abundant resources to show off their fiscal might.
Conspicuous vs. Conscious Consumption
Conspicuous consumption refers to buying expensive items to show off one’s wealth and success, while conscious one involves making ethical purchasing decisions that consider social responsibility and sustainability.
Conspicuous consumption is a term used to describe purchasing luxury items such as cars, clothes, jewelry, and other expensive items to demonstrate wealth and social standing (Veblen, 1899).
It is driven by a desire to gain recognition and admiration from others, and it is often considered an example of “keeping up with the Joneses.”
In contrast, conscious consumption is an increasingly popular trend that focuses on making ethical and sustainable choices when it comes to purchasing goods (Nestor, 2020).
It involves considering things like environmental impact, working conditions, fair wages for workers, and animal welfare when buying products.
People who practice conscious consumption are focused on supporting businesses that are doing the right thing for people and the planet rather than seeking out luxury items as status symbols.
| Conspicuous Consumption | Conscious Consumption |
|---|---|
| Focuses on showing off one’s economic capital and status through the consumption of luxury goods and services. | Focuses on making intentional, ethical, and sustainable choices in the consumption of goods and services. |
| Can lead to excessive and wasteful consumption, resulting in environmental and social harm. | Prioritizes reducing waste, minimizing environmental impact, and supporting socially responsible businesses. |
| Is often associated with materialism and a superficial focus on external appearances. | Encourages a deeper consideration of the social, environmental, and ethical implications of consumption choices. |
| Is often driven by the desire to conform to societal norms and expectations around wealth and status. | Is driven by personal values and a desire to contribute to a more sustainable and just world. |
| Can perpetuate inequality by creating a social hierarchy based on wealth and status. | Seeks to address inequality and support marginalized communities by making conscious choices around where and how to spend money. |
| Can lead to a cycle of never-ending consumption as people constantly seek to maintain and improve their status through the acquisition of more luxury goods and services. | Promotes mindful consumption and encourages people to focus on what they truly need and value rather than always seeking more. |
Motivations for Conspicuous Consumption
People have different motivations for engaging in conspicuous consumption, ranging from a need to show off their financial accomplishments to an overall desire for recognition and admiration.
1. Display of Wealth
One of the main motivations for conspicuous consumption is to display wealth, prestige, and social status (Qattan & Al Khasawneh, 2020).
By purchasing luxury items such as cars and designer clothes, people can demonstrate their success to others. It can be viewed as a way to show off one’s affluence and attract peer admiration.
2. Keeping up with the Joneses
Another motivation for conspicuous consumption is keeping up with the Joneses – that is, attempting to stay ahead of others regarding wealth and material possessions (Huang & Shi, 2015).
People may purchase expensive items to maintain or exceed their current level of affluence compared to those around them.
3. Self-Expression
Thirdly, people may engage in conspicuous consumption as a form of self-expression. By purchasing certain types of products or brands, individuals can express their own personal style and values.
In this way, purchases can serve as an extension of one’s identity and help to differentiate oneself from others.
Effects of Conspicuous Consumption
As the trend of conspicuous consumption continues to grow, it is essential to understand both its advantages and downsides. From boosting economic growth to widening the gap between haves and have-nots, these effects should not be overlooked.
Undeniably, conspicuous consumption can play a role in stimulating the economy as people spend more and create new jobs (Chaudhuri & Majumdar, 2010).
Furthermore, businesses strive to produce even more upscale products for those willing to pay top dollar due to increased competition within the industry, leading to increased innovative ideas.
For example, the rise of luxury car brands has led to increased competition and innovation in the automotive industry.
On the other hand, conspicuous consumption can have some negative effects. For example, it can lead to rising inequality by widening the gap between those with access to luxury goods and those without (Chaudhuri & Majumdar, 2010).
Additionally, conspicuous consumption is often linked with excess spending and debt accumulation – which can have serious financial consequences for individuals.
If practiced without consideration for ethical and sustainable alternatives, conspicuous consumption can also lead to environmental degradation.
In some cases, luxury items may be produced using unsustainable practices such as over-fishing, deforestation, or the use of petrochemical-based materials – all of which have a detrimental impact on the planet.
Conclusion
Conspicuous consumption is a complex socio-economic phenomenon that has both positive and negative implications.
It involves purchasing and displaying luxury goods and services to signal wealth and social status and gain admiration from others.
While conspicuous consumption can stimulate economic growth and drive innovation, it can also contribute to social inequality, increased materialism, and environmental degradation.
As society evolves and becomes more aware of the consequences of people’s consumption patterns, balancing the desire for status with responsible and sustainable choices is crucial.
By shifting people’s focus from conspicuous consumption towards conscious consumption, we can create a more equitable and environmentally friendly world for future generations.
References
Blackshaw, T. (2015). Routledge handbook of leisure studies. Routledge.
Chaudhuri, H. R., & Majumdar, S. (2010). Conspicuous consumption: Is that all bad? Investigating the alternative paradigm. Vikalpa: The Journal for Decision Makers, 35(4), 53–60. https://doi.org/10.1177/0256090920100405
Huang, L., & Shi, H. (2015). Keeping up with the Joneses: From conspicuous consumption to conspicuous leisure? Oxford Economic Papers, 67(4), 949–962. https://www.jstor.org/stable/43773289
Nestor, A. (2020). Being human in a consumer society. Routledge.
Qattan, J., & Al Khasawneh, M. (2020). The psychological motivations of online conspicuous consumption. International Journal of E-Business Research, 16(2), 1–16. https://doi.org/10.4018/ijebr.2020040101
Shanthi, R., Ahmed, M. R., Gurusamy, S., & Murari, P. (2019). Retailing: Trends in the new millennium. Mjp Publishers.
Veblen, T. (1899). The theory of the leisure class. Macmillan.
Viktoriya Sus (MA)
Viktoriya Sus is an academic writer specializing mainly in economics and business from Ukraine. She holds a Master’s degree in International Business from Lviv National University and has more than 6 years of experience writing for different clients. Viktoriya is passionate about researching the latest trends in economics and business. However, she also loves to explore different topics such as psychology, philosophy, and more.
This article was peer-reviewed and edited by Chris Drew (PhD). The review process on Helpful Professor involves having a PhD level expert fact check, edit, and contribute to articles. Reviewers ensure all content reflects expert academic consensus and is backed up with reference to academic studies. Dr. Drew has published over 20 academic articles in scholarly journals. He is the former editor of the Journal of Learning Development in Higher Education and holds a PhD in Education from ACU.