Consumption and Social Identity: Evidence from India
40 Pages Posted: 3 Jan 2011
Abstract
We examine spending on consumption items which have signaling value in social interactions across groups with distinctive social identities in India, where social identities are defined by caste and religious affiliations. The classification of such items was done by eliciting responses to a survey in India. We match the results of our survey with nationally representative micro data on household consumption expenditures. We find that disadvantaged caste groups such as Other Backward Castes spend nine percent more on visible consumption than Brahmin and High Caste groups while social groups such as Muslims spend eleven percent less, after controlling for differences in permanent income and demographic composition of households. These differences are significant and robust. Additionally, we find that these differences can be partly explained as a result of the status signaling nature of such consumption items.
Keywords: households, consumption, India
JEL Classification: D12, D70, O10
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Conspicuous Consumption and Race
By Kerwin Kofi Charles, Erik Hurst, ...
-
Habit Persistence and Keeping Up with the Joneses:Evidence from Micro Data
-
Habit Formation and Keeping Up with the Joneses: Evidence from Micro Data
-
Increasing Income Inequality, External Habits, and Self-Reported Happiness
By Karen E. Dynan and Enrichetta Ravina
-
Smooth It Like the 'Joneses'? Estimating Peer-Group Effects in Intertemporal Consumption Choice
By Jürgen Maurer and Andre Meier
-
A Test of Conspicuous Consumption: Visibility and Income Elasticities
By Ori Heffetz
-
How Blacks Use Consumption to Shape Their Collective Identity
By Michèle Lamont and Virág Molnár