“...with a utility function that has both a (standard) absolute and a relative consumption components and is — as is standardly assumed — concave in absolute consumption, the marginal utility from additional consumption through the absolute term approaches zero as income rises. The relative component hence becomes increasingly important as income rises. Status seeking, on this view, becomes increasingly important with economic growth... ”[1]
Prologue
Status concerns have long been recognized by economists as a major factor driving economic growth. For example, Adam Smith in The Theory of Moral Sentiments[2] emphasized that pursuit of wealth is a response more to want of status, than to pressures of existential needs, or desire to improve one's living... (read 1695 more words →)
I enjoyed this post. Thanks.
Re. the question where and why the governance pattern transitioned from stateless to hierarchical. This has been traditionally placed into times and places when foragers (hunter-gatherers) became farmers. There is a more modern school of thought that places the transition into locations abundant with natural resources, for example along the salmon-rich rivers in the Pacific Northwest. Canadian anthropologist Hayden is one of the proponents of the idea. See for example here:
Hayden, B., 2011. Big Man, Big Heart? The Political Role of Aggrandizers in Egalitarian and Transegalitarian Societies. https://doi.org/10.1057/9780230116269_7
An interesting aspect of the stateless societies from the modern economics point of view is the observation that exceptional producers of... (read more)
It has been my experience that most people will reject the described idea, regardless of being unable to present a substantive reason for doing so. When I decided to post here, I did not expect a much different outcome from most readers, but I did hope to get feedback from at least few, who would take some time to scrutinize the argument honestly. Of course the proposal might be not even wrong, which would explain the lack of will to go beyond just downvoting (if even).