Status Goods: Experimental Evidence from Platinum Credit Cards / Leonardo Bursztyn, Bruno Ferman, Stefano Fiorin, Martin Kanz, Gautam Rao.

Format:

Book

Author/Creator:

Bursztyn, Leonardo.

Contributor:

National Bureau of Economic Research.

Ferman, Bruno.

Fiorin, Stefano.

Kanz, Martin.

Rao, Gautam.

Series:

Working Paper Series (National Bureau of Economic Research) no. w23414.

NBER working paper series no. w23414

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2017.

Summary:

This paper provides novel field-experimental evidence on status goods. We work with an Indonesian bank that markets platinum credit cards to high-income customers. In a first experiment, we show that demand for the platinum card greatly exceeds demand for a nondescript control product with identical benefits, suggesting demand for the pure status aspect of the card. Transaction data reveal that platinum cards are more likely to be used in social contexts, implying social image motivations. Combining price variation with information on the use of the card sheds light on the magnitude of the demand for social status. In a second experiment, we provide evidence of positional externalities from the consumption of these status goods. The final experiment shows that increasing self-esteem causally reduces demand for status goods. We infer that part of the demand for status is psychological in nature, and that social image is a substitute for self-image.

Notes:

Print version record

May 2017.