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Celebrations as Social Investments: Festival Expenditures, Unit Price Variation and Social Status in Rural India



Festival expenditures amount to over 15 per cent of a household's annual expenditures in rural India. Yet they have never been studied by economists. This article uses both qualitative and quantitative data from a case study of three South Indian villages to show that festivals are important public goods in the village, but neither a pure entertainment motive nor an altruistic desire to contribute to a public event seems to explain their size. Households which spend money on festivals, everything else held equal, are able, however, to generate tangible rewards - lower prices on food, higher social status and more invitations to meals from other families. This indicates that active participation in festivals generates private economic and social returns which help resolve a potential free-rider problem. The evidence is consistent with the notion that festivals serve as mechanisms by which communities build social networks.

Suggested Citation

  • V. Rao, 2001. "Celebrations as Social Investments: Festival Expenditures, Unit Price Variation and Social Status in Rural India," Journal of Development Studies, Taylor & Francis Journals, vol. 38(1), pages 71-97.
  • Handle: RePEc:taf:jdevst:v:38:y:2001:i:1:p:71-97
    DOI: 10.1080/713601102

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    Cited by:

    1. Chen, Xi & Kanbur, Ravi & Zhang, Xiaobo, 2011. "Peer effects, risk pooling, and status seeking: What explains gift spending escalation in rural China?," IFPRI discussion papers 1151, International Food Policy Research Institute (IFPRI).
    2. Helena A. Williams & Robert L. Williams, Jr. & Maktoba Omar, 2014. "Experiencing-the-Experience: An Examination of the Significance of Infrastructure, Co-creation and Co-branding within the Transnational Gastronomic Tourism Industry," Transnational Marketing Journal, Transnational Press London, UK, vol. 2(1), pages 21-37, May.
    3. Omer Moav and & Zvika Neeman, 2012. "Saving Rates and Poverty: The Role of Conspicuous Consumption and Human Capital," Economic Journal, Royal Economic Society, vol. 122(563), pages 933-956, September.
    4. repec:gam:jsusta:v:10:y:2018:i:5:p:1468-:d:145101 is not listed on IDEAS
    5. van de Walle, Dominique & Ravallion, Martin & Mendiratta, Vibhuti & Koolwal, Gayatri, 2013. "Long-term impacts of household electrification in rural India," Policy Research Working Paper Series 6527, The World Bank.
    6. Vincenzo Lombardo, 2012. "Social inclusion and the emergence of development traps," Discussion Papers 13_2012, CRISEI, University of Naples "Parthenope", Italy.
    7. Siddique, Abu & Vlassopoulos, Michael, 2017. "Competitive Preferences and Ethnicity: Experimental Evidence from Bangladesh," IZA Discussion Papers 10682, Institute for the Study of Labor (IZA).
    8. Dominique van de Walle & Martin Ravallion & Vibhuti Mendiratta & Gayatri Koolwal, 2017. "Long-term Gains from Electrification in Rural India," World Bank Economic Review, World Bank Group, vol. 31(2), pages 385-411.
    9. Vincenzo Lombardo, 2012. "Social inclusion and the emergence of development traps," Discussion Papers 1_2012, D.E.S. (Department of Economic Studies), University of Naples "Parthenope", Italy.
    10. Barbeitos, Iolanda & Oom do Valle, Patrícia & Guerreiro, Manuela & Mendes, Júlio, 2014. "Visitors’ Motivations, Satisfaction and Loyalty towards Castro Marim Medieval Fair," Journal of Spatial and Organizational Dynamics, CIEO-Research Centre for Spatial and Organizational Dynamics, University of Algarve, vol. 2(1), pages 89-104.
    11. repec:prp:jattij:v:10:y:2017:i:2:p:115-128 is not listed on IDEAS
    12. Gretchen Larsen & Stephanie Hussels, 2011. "The Significance of Commercial Music Festivals," Chapters,in: Handbook on the Economics of Leisure, chapter 13 Edward Elgar Publishing.
    13. Johny, Judit & Wichmann, Bruno & Swallow, Brent M., 2017. "Characterizing social networks and their effects on income diversification in rural Kerala, India," World Development, Elsevier, vol. 94(C), pages 375-392.
    14. Jellal, Mohamed, 2014. "Diaspora transferts statut social et inégalité
      [Diaspora remittances social status and inequality]
      ," MPRA Paper 57325, University Library of Munich, Germany.
    15. Yolal, Medet & Gursoy, Dogan & Uysal, Muzaffer & Kim, Hyelin (Lina) & Karacaoğlu, Sıla, 2016. "Impacts of festivals and events on residents’ well-being," Annals of Tourism Research, Elsevier, vol. 61(C), pages 1-18.
    16. Anthon, Signe & Lund, Jens Friis & Helles, Finn, 2008. "Targeting the poor: Taxation of marketed forest products in developing countries," Journal of Forest Economics, Elsevier, vol. 14(3), pages 197-224, June.
    17. Irene Kamenidou & Spyridon Mamalis & George Kokkinis & Christina Intze, 2011. "Improvement Axons for Ardas Cultural Festival in Evros, Greece, based on attendees perceptions," Scientific Bulletin - Economic Sciences, University of Pitesti, vol. 10(2), pages 62-73.
    18. Tania Begazo-Gomez & Alan Fuchs & Ari Perdana, 2006. "Better Together – or not? Community Participation, Consumption Smoothing and Household Head Employment in Indonesia," Development Economics Working Papers 21814, East Asian Bureau of Economic Research.
    19. Moav, Omer & Neeman, Zvika, 2008. "Conspicuous Consumption, Human Capital and Poverty," CEPR Discussion Papers 6864, C.E.P.R. Discussion Papers.
    20. Yu Alvin Hung Chih & Yen I-Yin, 2012. "Segmenting Art Festival Visitors by Motivations," Scientific Annals of Economics and Business, De Gruyter Open, vol. 59(1), pages 213-226, July.


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