Abstract

The concept of conspicuous consumption has been around for many years. People tend to signal their wealth by purchasing expensive and exclusive goods in order to achieve a higher social status. This study analyzes how population density, consumer’s income, and other demographic factors, especially age group, affects the price and consumption of exclusive sneakers. By understanding consumer behavior in the case of sneakers, we can get insights on how consumers behave in general when it comes to consumption of status goods. This study will present a theoretical model based on microeconomic theories of utility maximization, market demand, and price discrimination. Along with that, this study will also present empirical evidence regarding the effects of population density and average income of people from different age groups on the average resale price of the sneakers using multiple linear regression. The findings show that the average resale price of the Yeezy sneaker has a negative relationship with population density of people from the age group 25 to 44. Along with that, the findings show that the average resale price of Yeezy and Off-White sneakers has a positive relationship with average income of people in the age group 15 to 24.

Advisor

Schwendel, John

Department

Economics

Disciplines

Behavioral Economics | Econometrics | Economic Theory

Keywords

conspicuous consumption, status goods, population density, sneakers

Publication Date

2021

Degree Granted

Bachelor of Arts

Document Type

Senior Independent Study Thesis

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