Consumer behavior and sociological research have recognized early on the negative externalities o... more Consumer behavior and sociological research have recognized early on the negative externalities of exposure to conspicuous consumption: anxiety, debt and wasteful consumption. This article contributes to political economy by incorporating the costs of exposure to wealth-signaling consumption into the materialist self-interest model of social policy preferences. The argument is that exposure to conspicuous consumption reduces support for social spending and increases demand for lower income taxes. Tax cuts impact purchasing power directly, allowing individuals to keep up with consumption standards and to avoid looking poor by comparison. Two USA-based analyses using fine-grained data on consumption and individual attitudes at the zip code and county level support the argument. Importantly, less-affluent citizens are more likely to prioritize cuts to social spending over tax increases, at higher levels of conspicuous consumption. Additional analyses rule out alternative explanations l...
Consumer behavior and sociological research have recognized early on the negative externalities o... more Consumer behavior and sociological research have recognized early on the negative externalities of exposure to conspicuous consumption: anxiety, debt and wasteful consumption. This article contributes to political economy by incorporating the costs of exposure to wealth-signaling consumption into the materialist self-interest model of social policy preferences. The argument is that exposure to conspicuous consumption reduces support for social spending and increases demand for lower income taxes. Tax cuts impact purchasing power directly, allowing individuals to keep up with consumption standards and to avoid looking poor by comparison. Two USA-based analyses using fine-grained data on consumption and individual attitudes at the zip code and county level support the argument. Importantly, less-affluent citizens are more likely to prioritize cuts to social spending over tax increases, at higher levels of conspicuous consumption. Additional analyses rule out alternative explanations l...
Uploads
Papers by Laura Lungu