Instruction: What is conspicuous consumption?

Response: In economic theory purchases are made by individuals or groups for their own personal or collective satisfaction. The utility of the purchase is relative only to the preferences of the individual or group of buyers. Conspicuous consumption is an exceptional form of behaviour where the purchase is driven primarily to make an ostentatious display of wealth. In particular, the buyer has a desire to impress others by their ability to pay a particularly high price for a prestige product. In this way the utility of the purchase driven by social rather than economic or physiological drivers. Satisfaction is derived from the audience reaction not to the positive attributes of the good or service, but to the wealth displayed by the purchaser. In this way the cost of purchase becomes the the only factor of significance to the buyer.