Waves in Consumption with Interdependence among Consumers

R. Cowan, W. Cowan, P. Swann

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22 Citations (Scopus)

Abstract

En in this paper we model the development of consumption when there are interactions between consumers. The consumer recognizes three reference groups: peer, distinction, and aspiration. The interplay of aspiration and distinction can lead to ‘waves’ in consumption; for example, the avant-garde consumption of up-market pioneers is copied by other types of consumer. As the latter aspire to emulate the former, the former seek distinction by varying their consumption. A consumption activity may start up market, then gradually descend the social spectrum. More complex patterns with continuing cycles in consumption can also be found. Jel classification d11,d62.
Original languageEnglish
Pages (from-to)149-177
JournalCanadian Journal of Economics-Revue Canadienne d'Economique
Volume37
Issue number1
DOIs
Publication statusPublished - 1 Jan 2004

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