arXiv subjects

Christian Ghiglino

Publications and source records attributed to Christian Ghiglino.

4 recordsLinked to original sources

arXiv2026

The Joneses Visit an Economics Lab

Existing literature offers persuasive evidence that individuals care about how their consumption compares to that of peers, and proposes a large variety of explanatory models. The present paper proposes a common framework for many of those models, and compares their ability to predict behavior in a laboratory experiment. We find evidence of Keeping up with the Joneses motivations but also find that conspicuous consumption is enhanced by Veblen motivations arising from peers' ability to observe one's own choice. Among the seven quasi-linear preference models we compare, our data are best explained by a model that contrasts envy and pride (upward vs downward comparisons) using a value function borrowed from Prospect Theory.

econ.GN↗

arXiv2026

Mobile but Miserable: Social comparison networks and social mobility

Although social mobility is widely viewed as desirable, we document an 'inverse-U' shaped relationship with well-being: mobility is positively associated with well-being when low, but the association diminishes as mobility increases and eventually becomes negative. To explain this, we build a model in which agents are embedded in a social comparison network and suffer from falling behind their peers. The model highlights two channels that can cause welfare to be decreasing in mobility at high levels. First, when mobility is high, further increases widen already significant gaps between agents from similar parental backgrounds but of different abilities. Second, when mobility is high, high-ability agents are already relatively well off. So further increases in social mobility increase inequality. We find evidence supportive of both channels in US data. The model also predicts, and data supports, that social integration -- where relationships form more along ability than background lines -- allows societies to benefit from mobility for longer. We interpret this as social mobility being multidimensional with both economic and social dimensions that are complementary.

econ.TH↗

arXiv2026

Status substitution and conspicuous consumption

This paper adapts ideas from social identity theory to set out a new framework for modelling conspicuous consumption. Agents derive utility from their consumption of a status good and from belonging to an identity group with high status good consumption. Importantly, these two sources of utility are substitutes. Agents also feel pressure to conform with their neighbours in a network. This framework can rationalise a set of seemingly conflicting stylised facts about conspicuous consumption that are currently explained by different families of models. In addition, our model delivers new testable predictions regarding the effect of network structure and income inequality on conspicuous consumption.

econ.TH↗

arXiv2024

Endogenous Identity in a Social Network

Interaction with individuals from other socioeconomic classes has been shown to be a main driver for social mobility. We employ tools of social identity theory and network analysis to show how exposure to individuals of different social identities can lead to interactions with them, and an adoption of their identity, creating social mobility. We find that even if all individuals have the same ability, they may endogenously choose different identities, leading to different classes and actions. In particular, we derive a sufficient condition for such an equilibrium to exist, which equates to a novel measure of cohesion. Furthermore, we show that the most socially mobile individuals (changing their identity) are those who either have few connections or a more heterogeneous mix of identities in their connections. Finally, we show that upward social mobility increases action levels in society, but not necessarily welfare.

econ.TH↗