This working paper was written by Yin-wong Cheung (University of California, Santa Cruz) and XingWang Qian (University of California, Santa Cruz).Motivated by the observed international reserve hoarding behavior in the post-1997 crisis period, we explore the Mrs Machlup’s wardrobe hypothesis...

The quest for social status is the driving force behind many human decisions, including the expenditure on conspicuous goods. Recent evidence shows that conspicuous consumption patterns vary across social groups. Further, rank-based status signalling models suggest that the income distribution...

The importance of using the Internet and the accompanying browsing of websites, especially social networking sites (SNS), has increased due to its many benefits, which benefit users, consumers, and stakeholders. The benefits of using the Internet include obtaining information from anywhere, at...

This paper analyses the relationship between relative income concerns and individual wellbeing in an economy of heterogeneous firm-worker pairs. Specifically, we study incentive contracting under moral hazard when workers compare their earnings with the economy's average wage. At the aggregate...

During World War II, artworks significantly outperformed all alternative investments in Occupied France. With the surge in demand for portable and easy-to-hide (discreet) assets such as artworks and collectible stamps, prices boomed. This suggests that discreet assets may be viewed as...

The quest for status is a powerful motivator, but does it affect inequality? This paper presents a novel lab experiment that was designed and conducted to identify the relationship between conspicuous consumption, access to credit, and inequality. We report four main findings: First, consumption...

The luxury goods market in China has seen a significant increase in consumer spending over the last decade. Researchers have identified economic transition and a growing middle-class to explain this evolving trend. A less discussed but important contextual determinant is growing income...