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How Much Do Others Matter? Explaining Positional Concerns for Different Goods and Personal Characteristics

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  • Inga Hillesheim

    ()

  • Mario Mechtel

    () (Institute for Labour Law and Industrial Relations in the EU, University of Trier)

Abstract

We test concerns for relative standing with respect to private consumption, income, leisure, savings, and personal characteristics, using data from a classroom survey. Our results show highest degrees of positionality for personal characteristics and income. In order to explain positionality, we employ survey participants’ ratings of items with respect to (i) observability and (ii) non-psychological negative externalities on others. Based on these ratings, our results show that non-psychological externalities play an important role for an item’s degree of positionality. In contrast to previous research, we find that there is no statistically significant effect of an item’s observability on its degree of positionality.

Suggested Citation

  • Inga Hillesheim & Mario Mechtel, 2012. "How Much Do Others Matter? Explaining Positional Concerns for Different Goods and Personal Characteristics," IAAEU Discussion Papers 201210, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
  • Handle: RePEc:iaa:dpaper:201210
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    1. repec:kap:reveho:v:15:y:2017:i:4:d:10.1007_s11150-015-9306-9 is not listed on IDEAS
    2. Yunfang Hu & Kazuo Mino, 2014. "Capital Accumulation and Structural Change in a Small Open Economy," Pacific Economic Review, Wiley Blackwell, vol. 19(5), pages 634-656, December.
    3. S. Wouters & N. Exel & M. Donk & K. Rohde & W. Brouwer, 2015. "Do people desire to be healthier than other people? A short note on positional concerns for health," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 16(1), pages 47-54, January.
    4. Goerke, Laszlo & Hillesheim, Inga, 2013. "Relative consumption, working time, and trade unions," Labour Economics, Elsevier, vol. 24(C), pages 170-179.
    5. Prettner, Klaus & Hof, Franz, 2016. "The Quest for Status and R&D-based Growth," Annual Conference 2016 (Augsburg): Demographic Change 145554, Verein für Socialpolitik / German Economic Association.
    6. Tim Friehe & Mario Mechtel, 2017. "Gambling to leapfrog in status?," Review of Economics of the Household, Springer, vol. 15(4), pages 1291-1319, December.
    7. Lars Thiel, 2014. "Illness and Health Satisfaction: The Role of Relative Comparisons," SOEPpapers on Multidisciplinary Panel Data Research 695, DIW Berlin, The German Socio-Economic Panel (SOEP).
    8. Friehe, Tim & Mechtel, Mario, 2014. "Conspicuous consumption and political regimes: Evidence from East and West Germany," European Economic Review, Elsevier, vol. 67(C), pages 62-81.
    9. Tim Friehe & Mario Mechtel, 2014. "Statuskonsum in Ost- und Westdeutschland: Beeinflusst durch das politische Regime?," ifo Dresden berichtet, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 21(03), pages 31-36, June.
    10. Bogaerts, Tess & Pandelaere, Mario, 2013. "Less is more: Why some domains are more positional than others," Journal of Economic Psychology, Elsevier, vol. 39(C), pages 225-236.

    More about this item

    Keywords

    behavioral economics; relative consumption; other-regarding preferences; relative standing;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D10 - Microeconomics - - Household Behavior - - - General

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