“Over the past two or three years people have finally started waking up to the fact that conspicuous consumption is now about useless degrees, not SUVs.”I'll take this as confirmation of an idea I've been pushing for a while now. When advising young people on the surest way to wealth this century, I say go into politics and get really good at it.
And I'm only half kidding.
From the Adam Smith Institute blog:
A new report, released today by the Adam Smith Institute, argues virtue signalling has made widely-held ideas like ‘keeping up with the Joneses’ and conspicuous consumption completely outdated. Rather than trying to one-up one another by buying Bentleys, Rolexes and fur coats, the modern social climber is more likely to try and show their ‘authenticity’ with virtue signalling by having the correct opinions on music and politics and making sure their coffee is sourced ethically, the research says.
The paper, The New Aristocrats: A cultural and economic analysis of the new virtue signalling by Prof. Ryan Murphy of Southern Methodist University in Texas, lays out how trends in status signalling—showing one’s self to be worthy of respect and privilege in the eyes of one’s group—have changed over recent decades.
While the conventional understanding holds that families are apt to buy ever-bigger cars and ever-bigger homes in the pursuit of higher social rank—a fruitless zero-sum competition that might well be tackled by luxury taxes—the new race for prestige is quite different.
A modern aspirant elitist would be better off getting an arts degree than buying a gas-guzzling four-by-four, Prof. Murphy points out, if they want to raise their profile in the eyes of their peers. This trend of ‘virtue signalling’ has been widely noted, but policy has not shifted with society.
Education is one policy where Murphy’s analysis is readily applicable. Though pursuing practical education, a STEM degree, or even building up work experience may be better for an individual’s earnings and society’s productivity, individuals may pick extended study of essentially useless degrees in pursuit of status....MORE
EXECUTIVE SUMMARY
• New patterns of status signalling are emerging focused on attempts at ‘authenticity.’
• These patterns are distinct from ‘classic’ aristocratic status signalling based on the costly acquisition of useless skills, and also distinct from ‘old’ status signalling based purely on wealth.
• The distastefulness of wealth-based status signalling creates a desire to signal one’s lack of interest in status games - hence a paradox is formed.
• Examples of the new status signalling include parts of internet activism and environmentalism – ‘conspicuous conservation.’
• New forms of status signalling and ‘conspicuous authenticity’ may be more socially wasteful than older forms of conspicuous consumption.
• New status signalling might also be less amenable to the traditional policy measures, such as luxury taxation....MORE
INTRODUCTION
Since Veblen, sociologists and economists have sought to understand the nature and importance of status signaling and conspicuous consumption. Today’s “conventional” understanding of status signaling is closely connected with criticisms of crass consumerism and consumer choices such as oversized houses and gaudy diamond rings. This paper contends that this portrayal of conspicuous consumption is generally – though not entirely – quixotic. While members of the upper class may still sometimes attempt to signal high status via such ostentatious displays of wealth, by and large, members of today’s elite recognize these choices are blatant attempts at signaling status, which undercuts them or even causes them to signal low status. What I call “new status signaling” expends resources to signal the opposite, that one is not a part of blind Western consumer culture but instead part of the solution to modern society’s problems. As a result, potential policy implications of status-signaling, such as a “Pigouvian” sales tax are blunted significantly....
