What is that thing within us that makes us strive to feel we are better than our neighbours? What is it that burns inside, driving us to compete with others? Which urges us to plough a huge part of ourselves into the endless race to show the superiority of our taste, our children, our capacity, our worldliness?
Whatever this force is - let's call it our 'primal snobbery' - somehow it thrives in our post-industrial, supercapitalist society. When our material needs - food, shelter, security - are met, all else is relative. As productive capacity passes a certain point and if certain structural (democratic?) properties are present, capitalist society falls into a hierarchical state where all members lie on a relative scale. In this condition, our entire purpose in life is to move up the relative scale. But it is not merely to move, but to be seen to move, for primal snobbery is not just about acquiring a level, it's about acquiring it with swagger.
Thinkers such as JK Galbraith and Fred Hirsch have said that when we enter the 'primal snobbery' state, that is, when society has for the most part met the material needs of its citizens, our focus shifts from the desire to enjoy social and public goods to the desire for what economists call, positional goods.
Positional goods are products (and services) whose value is mostly, if not exclusively, a function of their ranking in desirability in comparison to substitutes. The extent to which a good's value depends on such a ranking is referred to as its positionality. [wikipedia]. Ownership of these goods are markers of ones position in the social hierarchy. The location of one's home, branded handbags, or a table at a michelin restaurant are examples. So too are the size of one's car, the school attended by one's children, and where one goes for holiday.
Economists are increasingly concerning themselves with the issue of happiness and collective welfare. (In some ways this is a return to base. In the 19th Century thinkers such as John Stuart Mill debated the concept of utility). Many have come to the conclusion that our current obsession with the production and consumption of positional goods does not in fact increase our collective welfare. In fact, over time, it may even decrease our welfare.
An example is owning a house in suburbia as opposed to the crammed city centre. Once the status value of moving to the burbs became established, it became essential for middle class people to acquire the positional good. It's not that they needed the space materially, they wanted it as a status symbol. The herd followed the primal snobbery instinct and made its way to the burbs. Soon the burbs became crowded and their residents still needed to work in the city. The result was commuter chaos because, obsessed with the need to acquire the positional good, no-one prioritised the public good of transport infrastructure. In the end, as people sat in traffic, their net welfare diminished.
Here too is an example of market failure. The fact that my usage blocks the road for others is an externality. I'm only one user, "I won't make any difference". The benefit to me is living in the burbs, and the cost of the painful commute is borne by all users.
'Primal snobbery' then can triumph over the collective will in ways which reduce the total welfare. Clearly there is a good argument to rebalance society and the underpinning economy so that public goods are given more weight. This would involve an admission that part of the problem is the priority given to positional goods over public goods by way of reduced taxes.
Ironically, a better provision of public goods - such as schools, cancer services, and trains - would make a huge material difference to our lives. Yet we are loath to surrender the tax reductions which have allowed us to gather a plethora of positional goods in the form of status symbols. Unfortunately, we cannot have it both ways. If we really want better public goods, we need to control our 'primal snobbery' and forgo just a few of our status symbols.