Materialism on the March: From Conspicuous Leisure to Conspicuous Consumption?

Paul Frijters and Andrew Leigh

No 495, CEPR Discussion Papers from Centre for Economic Policy Research, Research School of Economics, Australian National University

Abstract: This paper inserts Veblen’s (1898) concepts of conspicuous leisure and conspicuous consumption into a very simple model. Individuals have the choice to either invest their time into working, leading to easily observable levels of consumption, or into conspicuous leisure, whose effect on utility depends on how observable leisure is. We let the visibility of leisure depend positively on the amount of time an individual and her neighbors have lived in the same area. Individuals optimize across conspicuous leisure and conspicuous consumption. If population turnover is high, individuals are made worse off, since the visibility of conspicuous leisure then decreases and the status race must be played out primarily via conspicuous consumption. Analyzing interstate mobility in the US, we find strong support for our hypothesis: a 1 percentage point rise in population turnover increases the average work week of non-migrants by 7 minutes. The negative externality of population turnover on the visibility of conspicuous leisure is an argument for higher transport taxes.

Keywords: conspicuous leisure; conspicuous consumption; mobility; labour supply; status races (search for similar items in EconPapers)
JEL-codes: B15 D10 D60 J22 J61 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2005-09
New Economics Papers: this item is included in nep-cbe and nep-pke
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Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Materialism on the March: From conspicuous leisure to conspicuous consumption? (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:auu:dpaper:495

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