by Alan Reynolds
Robert Frank, a professor of economics at Cornell, has long argued that affluent Americans spend too much on conspicuous consumption, which he relabels "positional" goods. His favorite examples include big houses, expensive watches, barbecue grills, and wine. If Smith has more positional goods than Jones, then Jones is said to suffer "relative deprivation" because "what we feel we need depends on what others have." Poverty is relative too. A small house seemed "terrific," he explains, "when I was a Peace Corps volunteer in Nepal."
An affluent professor and consultant with a five-bedroom house and a taste for BMWs, Frank nevertheless boasts that he never spends much on wine and that he decided to eschew a costly Viking grill in favor of a cheap Weber.
How he spends his own money is his business. Unfortunately, Frank views everyone else's money as collective property: "Do we want to spend our money on better teachers, better roads, and enhanced national security? Or do we want to spend it on more expensive watches, more elaborate gas grills, and bigger mansions?" Everyone else's money becomes "our money."
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