Abstract
The theory of compensatory consumption suggests that a possible lack of traditional avenues for fulfilling needs for social status may lead ethnic minorities to shift measures of social status from traditional indicators such as occupational prestige to consumption indicators of status conveying goods. In this study we investigate whether a household’s ethnic identity affects its budget allocation to status conveying goods. Annual budget shares for apparel, housing, and home furnishings are used for measuring status consumption. Results show that Asian American households allocate more of their budget to housing, while African American more to apparel, compared to European households. Hispanic households allocate more of their budget to both apparel and housing than European American households, but to a lesser degree compared to Asian Americans to housing and African Americans to apparel.
Similar content being viewed by others
References
Abdel-Ghany, M., & Sharpe, D. L. (1997). Consumption patterns among ethnic groups in Canada. Journal of Consumer Studies and Home Economics, 21, 215–223.
Applebaum, K., & Jordt, I. (1996). Notes toward an application of McCracken’s “Cultural Categories” for cross-cultural consumer research. Journal of Consumer Research, 23, 204–218.
Bagwell, L. S., & Bernheim, B. D. (1996). Veblen effects in a theory of conspicuous consumption. The American Economic Review, 86(3), 349–373.
Bauer, R. A., Cunningham, S. M., & Wortzel, L. (1965). The marketing dilemma of negroes. In C. H. Nightingale (Ed.), One the edge: A history of poor black children and their American dreams. New York: Basic Books.
Bell, D. (1960). The cultural contradictions in capitalism. New York: Basic Books.
Campbell, C. (1995). Conspicuous confusion? A critique of Veblen’s theory of conspicuous consumption. Sociological Theory, 13(1), 37–47.
Caplovitz, D. (1967). The poor pay more. Toronto: Collier-Macmillan.
Chao, A., & Schor, J. B. (1998). Empirical tests of status consumption: evidence from women’s cosmetics. Journal of Economic Psychology, 19(1), 1–30.
Chinoy, E. (1952). The tradition of opportunity and the aspirations of automobile workers. The American Journal of Sociology, 57(5), 453–459.
Corneo, G., & Olivier, J. (1997). Conspicuous consumption, snobbism and conformism. Journal of Public Economics, 66, 55–71.
Daun, A. (1983). The materialistic life-style: Some socio-psychological aspects. In L. Uusitalo (Ed.), Consumer behavior and environmental quality (pp. 6–16). Hampshire: Gower.
Dubios, B., & Duquesne, P. (1993). The market for luxury goods: Income versus culture. European Journal of Marketing, 23(1), 35–44.
Dugger, W. M. (1988). A research agenda for institutional economics. Journal of Economic Issues, 22(4), 983–1002.
Ebony, September (1949). Why negroes buy cadillacs p. 34. In C. H. Nightingale (Ed.), One the edge: A history of poor black children and their American dreams. New York: Basic Books.
Fan, J. X. (1997). Expenditure patterns of Asian Americans: Evidence from the U.S. Consumer Expenditure Survey, 1980–1992. Family and Consumer Sciences Research Journal, 25(4), 339–368.
Fan, J. X. (1998). Ethnic differences in household expenditure patterns. Family and Consumer Sciences Research Journal, 26(4), 371–400.
Fan, J. X., & Burton, J. R. (2002). Students’ perception of status-conveying goods. Financial Counseling and Planning Education, 13(1), 35–46.
Fan, J. X., & Lewis, J. K. (1999). Budget allocation patterns of African Americans. The Journal of Consumer Affairs, 33(1), 134–164.
Fan, J. X., & Zuiker, V. S, (1998). A comparison of household budget allocation patterns between Hispanic Americans and non-Hispanic White Americans. Journal of Family and Economic Issues, 19(2), 151–172.
Fost, D. (1990). California’s Asian market. American Demographics, 12(10), 34–37.
Frank, R. H. (1985). Choosing the right pond: Human behavior and the quest for status. New York: Oxford University Press.
Geng, C. (2001). Marketing to ethnic consumers: A historical journey (1932–1997). Journal of Macromarketing, 21(1), 23–32.
Gottdiener, M. (2000). Approaches to consumption: Classical and contemporary perspectives. In New forms of consumption: Consumers, culture & commodification (pp. 3–32). Oxford, England: Rowman & Littlefield; Cumnor Hill.
Gronmo, S. (1988). Compensatory consumer behavior: Elements of a critical sociology of consumption. In P. Otnes (Ed.), The sociology of consumption (pp. 65–85). New Jersey: Humanities Press International.
Hagendoorn, L. (1993). Ethnic categorization and outgroup exclusion: Cultural values and social stereotypes in the construction of social hierarchies. Ethnic and Racial Studies, 16(1), 26–51.
Hollander, J. A., & Howard, J. A. (2000). Social psychological theories in social inequalities. Social Psychology Quarterly, 63(4), 338–351.
Humphreys, J. M. (2002). The muliticultural economy 2002: Minority buying power in the new century. Georgia Business and Economic Conditions, 8(2).
Jahoda, M., Lazarsfeld, P. F., & Zeisel, H. (1933). Die arbeitslosen von marienthal. In S. Gronmo, Compensatory consumer behavior: Elements of a critical sociology of consumption. In P. Otnes (Ed.), The sociology of consumption (pp. 65–85). New Jersey: Humanities Press International.
Jaramillo, F., & Moizeau, F. (2003). Conspicuous consumption and social segmentation. Journal of Public Economic Theory, 5(1), 1–24.
Lal, B. B. (1995). Symbolic interaction theories. The American Behavioral Scientist, 38, 421–441.
Leibenstein, H. (1950). Bandwagon, snob and Veblen effects in the theory of consumers’ demand. Quarterly Journal of Economics, 64, 183–207.
Lim, N. (2000). Employers’ attitudes, social division of labor, and human resource practices in hiring low-skilled workers. Dissertation Abstracts International, A: The Humanities and Social Sciences, 61, 2.
Lyman, S. M. (1984). Interactionism and the study of race relations at the macro-sociological level: The contribution of Herbert Blumer. Symbolic Interaction, 7(1), 107–120.
Lynd, R. S., & Lynd, H. M. (1937). Middletown in transition. A study in cultural conflicts. New York: Harcourt, Brace and Company.
Maher, T. M. (1986). Met life focusing on Asian Americans. National Underwriter, 90(14), 4–8.
Maslow, A. H. (1954). Motivation and personality. New York: Harper and Row.
Mason, R. (1981). Conspicuous consumption: A study of exceptional consumer behavior. Hampshire, England: Gower Publishing Company Ltd.
Mason, R. S. (1983). The economic theory of conspicuous consumption. International Journal of Social Economics, 1(3), 3–17.
McCracken, G. (1986). Culture and consumption: A theoretical account of the structure and movement of the cultural meaning of consumer goods. Journal of Consumer Research, 13, 71–84.
Mills, C. W. (1951). White Collar. The American Middle Classes. New York: Oxford University Press.
Paulin, G. D. (1998). A growing market: Expenditures by Hispanic consumers. Monthly Labor Review, March, 3–21.
Richins, M. L. (1994). Valuing things: The public and private meaning of possessions. Journal of Consumer Research, 21, 504–521.
Schor, J. B. (1998). The overspent American: Upscaling, downshifting, and the new consumer. New York: Basic Books.
Solomon, M. R. (1983). The role of products as social stimuli: A symbolic interactionism perspective. Journal of Consumer Research, 10, 319–329.
Stafford, J. E., Cox, K. K., & Higginbottom, J. B. (1971). Some consumption pattern differences between urban Whites and Negroes. In C. H. Nightingale (Ed.), One the edge: A history of poor black children and their American dreams. New York: Basic Books.
Stankovic, F. (1986). The relevance of the phenomenon of “Conspicuous Consumption” for the general theory of consumption. Economic Analysis and Worker’s Management, 4, 375–383.
Trigg, A. B. (2001). Veblen, Bourdieu, and conspicuous consumption. Journal of Economic Issues, 25(1), 99–116.
U.S. Bureau of the Census, 2000. CPS annual demographic supplement. .
van Kempen, L. (2003). Fooling the eye of the beholder: Deceptive status signaling among the poor in developing countries. Journal of International Development, 15(2), 157–177.
Veblen, T. (1899). Theory of the leisure class. New York: The New American Library.
Venkatesh, A. (1995). Ethnoconsumerism: A new paradigm to study cultural and cross-cultural consumer behavior. In A. Costa, & G. Bamossey (Eds.), Marketing in a multicultural world: Ethnicity, nationalism and cultural identity (pp. 26–67). Thousand Oaks, California: Sage Publications.
Wagner, J., & Soberon-Ferrer, H. (1990). The effect of ethnicity on selected household expenditures. Social Science Journal, 27(2), 181–199.
Wolf, C. (1986). Legitimization of oppression: Response and reflexivity. Symbolic Interaction, 9(2), 217–234.
Woodruffe, H. R. (1997). Compensatory consumption: Why women go shopping when they’re fed up and other stories. Marketing Intelligence & Planning, 15(7), 325–337.
Woodruffe-Burton, H. (1998). Private desires, public display: Consumption, postmodernism and fashion’s “new man”. International Journal of Retailing and Distribution Management, 26(8), 301–313.
Acknowledgement
The authors wish to acknowledge Dr. Robert N. Mayer and Dr. Armando Solorzano, as well as the anonymous reviewers for their insightful comments on earlier versions of this paper.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Fontes, A., Fan, J.X. The Effects of Ethnic Identity on Household Budget Allocation to Status Conveying Goods. J Fam Econ Iss 27, 643–663 (2006). https://doi.org/10.1007/s10834-006-9031-x
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10834-006-9031-x