Next video:
Loading the player...

Named after economist Thorstein Veblen, who introduced the term “conspicuous consumption,” a Veblen good is one whose demand increases as its price increases because consumers see it as an exclusive status symbol. Unlike most goods, which have a downward-sloping demand curve because demand goes down as price goes up, a Veblen good has an upward-sloping demand curve.

Veblen goods are high quality, coveted items. They are designer, luxury items with a strong brand identity, and they are not sold in regular stores. These goods are priced so high that only the very affluent can afford them; the higher their price, the less likely other consumers can afford them, and the more buyers perceive them to signal great wealth and success. If a Veblen’s good price decreases, demand will decrease because status-conscious consumers will see it as less exclusive.

  1. No results found.
Related Articles
  1. Personal Finance

    5 Overpaid Jobs

    Looking at whether someone else could do the same job for less pay, we find some surprising overpaid jobs.
  2. Insights

    Law of Demand

    The law of demand is one of the most fundamental principles in microeconomics. It's all about how price affects demand. According to the law of demand, for all other things remaining constant, ...
  3. Insights

    Introduction To Supply And Demand

    Find out all about supply and demand and how it relates to your daily purchases.
  4. Insights

    Explaining Quantity Demanded

    Quantity demanded describes the total amount of goods or services that consumers demand at any given point in time.
  5. Insights

    What are Consumer Goods?

    Products that are purchased for consumption by the average consumer. Clothing, food, automobiles and jewelry are all examples of consumer goods
  6. Insights

    Calculating Income Elasticity of Demand

    Income elasticity of demand is a measure of how consumer demand changes when income changes.
  7. Insights

    What is Supply & Demand?

    The law of supply and demand is one of the most basic principles in economics. In simplest terms, the law of supply and demand states that when an item is scarce, but many people want it, the ...
  8. Insights

    The Evolution Of Ticker Symbols

    The stock market has changed dramatically since its inception, but the use of ticker symbols has remained largely unchanged.
  9. Insights

    What Does Price Level Mean?

    Price level is the average of all current prices for goods and services in an economy.
Hot Definitions
  1. Fixed Cost

    A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses ...
  2. Blue Chip

    A blue chip is a nationally recognized, well-established, and financially sound company.
  3. Payback Period

    The length of time required to recover the cost of an investment. The payback period of a given investment or project is ...
  4. Collateral Value

    The estimated fair market value of an asset that is being used as loan collateral. Collateral value is determined by appraisal ...
  5. Fiduciary

    A fiduciary is a person who acts on behalf of another person, or persons to manage assets.
  6. Current Account

    The difference between a nation’s savings and its investment. The current account is defined as the sum of goods and services ...
Trading Center