Status Goods: Experimental Evidence from Platinum Credit Cards
Status Goods: Experimental Evidence from Platinum Credit Cards
7 July, 2020 •Similar Articles
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This paper provides novel field-experimental evidence on status goods. We work with an
Indonesian bank that markets platinum credit cards to high-income customers. In a first
experiment, we show that demand for the platinum card greatly exceeds demand for a nondescript
control product with identical benefits, suggesting demand for the pure status aspect of the card.
Transaction data reveal that platinum cards are more likely to be used in social contexts, implying
social image motivations. Combining price variation with information on the use of the card
sheds light on the magnitude of the demand for social status. In a second experiment, we provide
evidence of positional externalities from the consumption of these status goods. The final
experiment shows that increasing self-esteem causally reduces demand for status goods. We infer
that part of the demand for status is psychological in nature, and that social image is a substitute
for self-image.