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Status Goods: Experimental Evidence from Platinum Credit Cards

Leonardo Bursztyn, Bruno Ferman, Stefano Fiorin, Martin Kanz () and Gautam Rao

No 23414, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper provides novel field-experimental evidence on status goods. We work with an Indonesian bank that markets platinum credit cards to high-income customers. In a first experiment, we show that demand for the platinum card greatly exceeds demand for a nondescript control product with identical benefits, suggesting demand for the pure status aspect of the card. Transaction data reveal that platinum cards are more likely to be used in social contexts, implying social image motivations. Combining price variation with information on the use of the card sheds light on the magnitude of the demand for social status. In a second experiment, we provide evidence of positional externalities from the consumption of these status goods. The final experiment shows that increasing self-esteem causally reduces demand for status goods. We infer that part of the demand for status is psychological in nature, and that social image is a substitute for self-image.

JEL-codes: C93 D03 D12 O12 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-exp, nep-pay and nep-sea
Date: 2017-05
Note: DEV LS PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17) Track citations by RSS feed

Published as Leonardo Bursztyn & Bruno Ferman & Stefano Fiorin & Martin Kanz & Gautam Rao, 2018. "Status Goods: Experimental Evidence from Platinum Credit Cards*," The Quarterly Journal of Economics, vol 133(3), pages 1561-1595.

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Journal Article: Status Goods: Experimental Evidence from Platinum Credit Cards (2018) Downloads
Working Paper: Status goods: experimental evidence from platinum credit cards (2017) Downloads
Working Paper: Status Goods: Experimental Evidence from Platinum Credit Cards (2016) Downloads
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