When the American dream fails: The effect of perceived economic inequality on present‐oriented behavior

Bak, Hyuna; Yi, Youjae

doi:10.1002/mar.21369

Cited by 17 publications

(9 citation statements)

References 161 publications

(173 reference statements)

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“…Conversely, when inequality is high (versus. low), individuals are inclined to believe that climbing the social hierarchy is more difficult and attributed more to luck than effort (Bak & Yi, 2020). As a consequence, they see less efficacy in engaging in behaviours instrumental to goal achievement (Bak & Yi, 2020).…”

Section: Need For Statusmentioning

confidence: 99%

Consumer confidence and conspicuous consumption: A conservation of resources perspective

Hampson

Wang

et al. 2021

Int J Consumer Studies

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The belief that consumer confidence exerts a positive effect on conspicuous consumption has been propagated by prominent research and consultancy firms (e.g., Boston Consulting Group, 2020;Euromonitor, 2020; McKinsey & Company, 2020). Amid a precipitous decline in global consumer confidence (Financial Times, 2020), Felsted (2020) opines that "in leaner times, luxury tends to become more discreet and that's a worry for those brands that have made the logo, such as Gucci's double G, a key element of their look". But is there really a link between consumer confidence and conspicuous consumption? If so, which psychological mechanisms underlie this relationship?Examining the relationship between consumer confidence and conspicuous consumption is important for two main reasons. First, conspicuous consumption has salient downstream consequences for a range of stakeholders, including economists, marketers and sociologists. From an economic perspective, conspicuous consumption is worth approximately US$290 billion to the global economy (Goenka & Thomas, 2020). From a marketing perspective, changes in consumer proclivity towards conspicuous consumption have implications for branding (Jacob et al., 2020), product design (Greenberg et al., 2020), pricing (Rao & Schaefer, 2013) and even front-line employee dress codes (Mende et al., 2018). From a social perspective, conspicuous consumption associates with a range of consequences, including environmental issues (McCollough, 2020), crime (Mejia & Restrepo, 2016), social relationships (Cannon & Rucker, 2019) and other behaviours subject to moral judgement (Goenka & Thomas, 2020). Therefore, tracking trends in consumer confidence data have the potential to help relevant stakeholders anticipate and perhaps mitigate, changes in these important issues.Second, research on the nomological network of consumer confidence is required amid debate about its efficacy as a predictor of consumer behaviour. Although a substantial body of research empirically demonstrates the predictive validity of consumer confi-

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Section: Need For Statusmentioning

confidence: 99%

Consumer confidence and conspicuous consumption: A conservation of resources perspective

Hampson

Wang

et al. 2021

Int J Consumer Studies

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“…Hence, perceived economic mobility directly affects decision-making and behavior whereas perception of economic inequality indirectly affects decision-making and behavior by shaping perceived economic mobility to some degree. This has been empirically demonstrated (Bak and Yi, 2020). Moreover, Davidai (2018) showed in a series of studies that internal factors (drive, hard work, ability, and talent) and external factors (family, connections, and luck) more strongly affect perceived economic mobility than does perceive income inequality.…”

Section: Relationship With Economic Inequalitymentioning

confidence: 85%

The Impact of Perceived Economic Mobility on Decision-Making and Behavior: A Succinct Review and Future Research Directions

Kim

2022

ijbass

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Research in marketing and psychology has shown that individual perception of economic mobility varies widely even in a single society and systematically influences decision-making and behavior across different domains. The objective of this paper is to introduce this important construct to researchers in other fields so that they can utilize and further develop it in future research. In particular, this paper highlights differences between perceived economic mobility and observed economic mobility and provides a critical and succinct review of the processes by which perceived economic mobility influences decision-making and behavior. Various future research directions are discussed as well.

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“…Future research needs to test hypotheses implied in the current research, such as whether low subjective SES consumers who perceive low social mobility use conspicuous consumption as a symbolic compensatory strategy (Cui et al, 2020). In addition, alternative mechanisms, such as time orientation (Bak & Yi, 2020) and sense of control (Lammers & Imhoff, 2021), should also be explored. Third, the main effect of subjective SES on conspicuous consumption is not significant in Study 3.…”

Section: Discussionmentioning

confidence: 99%

The effects of subjective socioeconomic status on conspicuous consumption

Wang

Liu

Lin

et al. 2022

J Applied Social Pyschol

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Conspicuous consumption, the purchase, and exhibit of expensive and luxury items to signal wealth and status to others, is common in everyday life. Although conspicuous consumption seems to be exclusive to high‐status people, past research suggests that conspicuous consumption also allows people to compensate for feeling being lower in the social hierarchy. Four studies (Study 1a: N = 242; Study 1b: N = 208; Study 2, N = 242; Study 3, N = 128) examined the relationship between subjective socioeconomic status (SES) and conspicuous consumption, and the moderating role of social mobility beliefs. We found that people with low subjective SES are more likely to engage in conspicuous consumption (Studies 1a, 1b, and 2). We also provided evidence for the joint effect of subjective SES and social mobility belief on conspicuous consumption, such that low subjective SES people who perceive low social mobility are more prone to conspicuous consumption than other people (Studies 2 and 3). The findings are robust to whether subjective SES was measured (Studies 1a) or manipulated (Studies 1b, 2, and 3) and various forms of conspicuous consumption. The current research contributes to the literature on SES, conspicuous consumption, and social mobility belief. Practical implications and future directions are discussed.

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When the American dream fails: The effect of perceived economic inequality on present‐oriented behavior

Cited by 17 publications

References 161 publications

Consumer confidence and conspicuous consumption: A conservation of resources perspective

Consumer confidence and conspicuous consumption: A conservation of resources perspective

The Impact of Perceived Economic Mobility on Decision-Making and Behavior: A Succinct Review and Future Research Directions

The effects of subjective socioeconomic status on conspicuous consumption

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