Fooling the eye of the beholder: deceptive status signalling among the poor in developing countries

Luuk Van Kempen
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Luuk Van Kempen: CentER and Department of Economics, Tilburg University, The Netherlands, Postal: CentER and Department of Economics, Tilburg University, The Netherlands

Journal of International Development, 2003, vol. 15, issue 2, 157-177

Abstract: Poor consumers in the developing world use a variety of status signalling devices that rely on deception of the observer. A frequently used deceptive strategy is the consumption of counterfeit instead of original status-intensive goods, mainly cheap copies of expensive brand-name goods from developed countries. The choice for such deceptive modes of conspicuous consumption is analysed within a product characteristics approach as developed by Lancaster and compared with non-deceptive alternatives. Under the controversial assumption that the poor care about status, it is shown that counterfeit goods embody a more 'appropriate' combination of status and functionality than original goods. It appears that the consumption of counterfeits potentially enhances the welfare of low-income consumers, depending on the extent to which the eye of the relevant beholder is effectively deceived. Copyright © 2003 John Wiley & Sons, Ltd.

Date: 2003
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Persistent link: https://EconPapers.repec.org/RePEc:wly:jintdv:v:15:y:2003:i:2:p:157-177

DOI: 10.1002/jid.973

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