See it to believe it. Experimental evidence on status good consumption among the youth

Guillermo Alves, Martin Leites and Gonzalo Salas

No 22-12, Documentos de Trabajo (working papers) from Instituto de Economía - IECON

Abstract: We ran a field experiment in which 20-year-olds choose between a socially visible and a non-socially visible good after a friend randomly received one of these goods or an unknown good. We find no differences in choices when the friend received the non-socially visible good instead of the unknown one. However, we find differences when the friend received the socially visible good instead of the other two. Consistent with a status-consumption interpretation, the sign of those differences depends on the socioeconomic position of the decision maker compared to her friend. Those in a disadvantaged position consume more and those in an advantaged position consume less of the socially-visible good when their friend received that good instead of the other two. We further find that treatment effects vary by gender in a way that reinforces the status consumption interpretation of our results. Boys experience a worse subjective social position and consume more of the socially visible good after a friend received that good. On the contrary, girls improve their subjective position when a friend received the socially visible good, and this offsets any effect on their consumption decision.

Keywords: consumption; status goods; field experiment; inequality (search for similar items in EconPapers)
JEL-codes: C93 D12 D31 D62 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2022-08
New Economics Papers: this item is included in nep-exp and nep-lam
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://hdl.handle.net/20.500.12008/34788

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Persistent link: https://EconPapers.repec.org/RePEc:ulr:wpaper:dt-12-22

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