Positional Goods

AAA

DEFINITION of 'Positional Goods'

Goods which act as a status symbols, signaling their owners' high relative standing within society. Positional goods often exhibit superior quality and features. However, these goods derive most of their value from the level of reliability with which they serve to distinguish their owners as members of the favored group.

INVESTOPEDIA EXPLAINS 'Positional Goods'

To accomplish the goal of signaling high standing, positional goods must be available only to those within a desired group. For example, where the desired group is the wealthy, exclusivity is easily accomplished through setting a high price. Economist Thorstein Veblen is famous for his study of how economic activity is influenced by social contexts. Veblen introduced the term "conspicuous consumption" to describe his observations of how goods can be used to indicate social position.

RELATED TERMS
  1. Permanent Income Hypothesis

    A theory of consumer spending which states that people will spend ...
  2. Status Symbol

    A status symbol is an object which is meant to signify its owners' ...
  3. Wealth Psychologist

    A wealth psychologist is a mental health professional who specializes ...
  4. Consumption Function

    The consumption function is a mathematical formula laid out by ...
  5. Wealth

    A measure of the value of all of the assets of worth owned by ...
  6. Voluntary Simplicity

    A lifestyle that minimizes consumption and the pursuit of wealth ...
Related Articles
  1. Fundamental Analysis

    How Influential Economists Changed Our History

    Find out how these five groundbreaking thinkers laid our financial foundations.
  2. Budgeting

    Stop Keeping Up With The Joneses - They're Broke

    Conspicuous consumption could be robbing you of future wealth.
  3. Credit & Loans

    The Disposable Society: An Expensive Place To Live

    Resisting the trend toward consumption will boost your bottom line and bolster the environment.
  4. Options & Futures

    3 Simple Steps To Building Wealth

    Getting richer is easier if you take it one step at a time.
  5. Budgeting

    Downshift To Simplify Your Life

    Learn how to ditch the rat race with voluntary simple living.
  6. Economics

    Where is cost of living lowest in the world?

    Learn how the cost of living is the lowest in India based on numbers derived from the CPI and organizations like Expatistan and Numbeo.
  7. Economics

    Economics Basics

    Learn economics principles such as the relationship of supply and demand, elasticity, utility, and more!
  8. Investing

    Opportunity Cost

    Every action has a cost, even the ones you don't pursue. Find out how this is calculated.
  9. Economics

    How Fannie Mae And Freddie Mac Were Saved

    These mortgage giants had to be put under government conservatorship, driving home the gravity of the subprime crisis.
  10. Economics

    The Economics Of Labor Mobility

    Loosening labor restrictions has both good and bad effects for a country and its workers.

You May Also Like

Hot Definitions
  1. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  2. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  3. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  4. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
  5. Annual Percentage Rate - APR

    The annual rate that is charged for borrowing (or made by investing), expressed as a single percentage number that represents ...
  6. Free Carrier - FCA

    A trade term requiring the seller to deliver goods to a named airport, terminal, or other place where the carrier operates. ...
Trading Center