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The Effects of Ethnic Identity on Household Budget Allocation to Status Conveying Goods


  • Angela Fontes


  • Jessie Fan



The theory of compensatory consumption suggests that a possible lack of traditional avenues for fulfilling needs for social status may lead ethnic minorities to shift measures of social status from traditional indicators such as occupational prestige to consumption indicators of status conveying goods. In this study we investigate whether a household’s ethnic identity affects its budget allocation to status conveying goods. Annual budget shares for apparel, housing, and home furnishings are used for measuring status consumption. Results show that Asian American households allocate more of their budget to housing, while African American more to apparel, compared to European households. Hispanic households allocate more of their budget to both apparel and housing than European American households, but to a lesser degree compared to Asian Americans to housing and African Americans to apparel. Copyright Springer Science+Business Media, Inc. 2006

Suggested Citation

  • Angela Fontes & Jessie Fan, 2006. "The Effects of Ethnic Identity on Household Budget Allocation to Status Conveying Goods," Journal of Family and Economic Issues, Springer, vol. 27(4), pages 643-663, December.
  • Handle: RePEc:kap:jfamec:v:27:y:2006:i:4:p:643-663
    DOI: 10.1007/s10834-006-9031-x

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    References listed on IDEAS

    1. Fernando Jaramillo & Fabien Moizeau, 2003. "Conspicuous Consumption and Social Segmentation," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 5(1), pages 1-24, January.
    2. McCracken, Grant, 1986. " Culture and Consumption: A Theoretical Account of the Structure and Movement of the Cultural Meaning of Consumer Goods," Journal of Consumer Research, Oxford University Press, vol. 13(1), pages 71-84, June.
    3. Solomon, Michael R, 1983. " The Role of Products as Social Stimuli: A Symbolic Interactionism Perspective," Journal of Consumer Research, Oxford University Press, vol. 10(3), pages 319-329, December.
    4. Bagwell, Laurie Simon & Bernheim, B Douglas, 1996. "Veblen Effects in a Theory of Conspicuous Consumption," American Economic Review, American Economic Association, vol. 86(3), pages 349-373, June.
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    Cited by:

    1. Wen-yeh Huang, 2010. "Brand Story and Perceived Brand Image: Evidence from Taiwan," Journal of Family and Economic Issues, Springer, vol. 31(3), pages 307-317, September.
    2. repec:eee:jotrge:v:38:y:2014:i:c:p:122-136 is not listed on IDEAS
    3. Jamal, Ahmad & Shukor, Syadiyah Abdul, 2014. "Antecedents and outcomes of interpersonal influences and the role of acculturation: The case of young British-Muslims," Journal of Business Research, Elsevier, vol. 67(3), pages 237-245.
    4. Rui Yao & Deanna Sharpe & Elizabeth Gorham, 2011. "An Exploratory Study of Chinese Americans’ Debt Ownership," Journal of Family and Economic Issues, Springer, vol. 32(4), pages 600-611, December.
    5. Saad, Gad & Vongas, John G., 2009. "The effect of conspicuous consumption on men's testosterone levels," Organizational Behavior and Human Decision Processes, Elsevier, vol. 110(2), pages 80-92, November.
    6. Anna Paulson & Sherrie Rhine, 2008. "The Financial Assimilation of an Immigrant Group: Evidence on the Use of Checking and Savings Accounts and Currency Exchanges," Journal of Family and Economic Issues, Springer, vol. 29(2), pages 264-278, June.


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