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How Much Will People Pay for Status?

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  • Justin Burkett

Abstract

Peoples' concerns for status may raise problems for traditional economic models. For example, concern for status leads people to have interdependent preferences. Recent empirical work has been done to determine the scope and magnitude of this concern with regard to income. This paper builds on these recent empirical findings. Using a survey, this paper shows that status-driven concerns for income are abundant and vary over a wide range. Based on information supplied by participants, women showed more concern for status than men. Family income and future expectations also were significant in an ordered probit regression.

Suggested Citation

  • Justin Burkett, 2006. "How Much Will People Pay for Status?," The American Economist, Sage Publications, vol. 50(1), pages 80-87, March.
    • Handle: RePEc:sae:amerec:v:50:y:2006:i:1:p:80-87
    DOI: 10.1177/056943450605000106
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    References listed on IDEAS

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    1. Pingle, Mark & Mitchell, Mike, 2002. "What motivates positional concerns for income?," Journal of Economic Psychology, Elsevier, vol. 23(1), pages 127-148, February.
    2. Frank, Robert H, 1997. "The Frame of Reference as a Public Good," Economic Journal, Royal Economic Society, vol. 107(445), pages 1832-1847, November.
    3. Samuelson, William & Zeckhauser, Richard, 1988. "Status Quo Bias in Decision Making," Journal of Risk and Uncertainty, Springer, vol. 1(1), pages 7-59, March.
    4. Daniel J. Zizzo & Andrew J. Oswald, 2001. "Are People Willing to Pay to Reduce Others'Incomes?," Annals of Economics and Statistics, GENES, issue 63-64, pages 39-65.
    5. Thorstein Veblen, 1899. "Mr. Cummings's Strictures on "The Theory of the Leisure Class"," Journal of Political Economy, University of Chicago Press, vol. 8(1), pages 106-106.
    6. repec:adr:anecst:y:2001:i:63-64:p:03 is not listed on IDEAS
    7. Easterlin, Richard A., 1974. "Does Economic Growth Improve the Human Lot? Some Empirical Evidence," MPRA Paper 111773, University Library of Munich, Germany.
    8. Veblen, Thorstein, 1899. "The Theory of the Leisure Class," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number veblen1899.
    9. J. Solnick, Sara & Hemenway, David, 1998. "Is more always better?: A survey on positional concerns," Journal of Economic Behavior & Organization, Elsevier, vol. 37(3), pages 373-383, November.
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    Cited by:

    1. Solnick, Sara J. & Hemenway, David, 2009. "Do spending comparisons affect spending and satisfaction?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(4), pages 568-573, August.

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