Spending is used to display status, so visibility rather than utility drives the purchase.
Veblen's 1899 argument: the point of the display is that it is wasteful, since only waste is credible evidence of surplus. The handicap principle rediscovered the same logic in biology seventy years later.
In practice
- A watch that keeps no better time than a phone signals the ability to spend on a watch, which is the entire function.
- A firm's marble reception says the firm can afford marble, which is what the client is reading.
- Further reading
- Wikipedia
- Subject
- Sociology & Culture
- Essay
- How societies hold together, sort people, and change