The impact of economic perceptions on status consumption: an exploratory study of the moderating role of education

Abstract

Purpose – Given the economic downturn, the purpose of this study was to determine if a relationship exists between economic perceptions and consumers' motivation to consume for status and if this relationship was moderated by education level. Design/methodology/approach – A stratified random sample of adult consumers in the southeastern USA were surveyed by telephone. The hypotheses were tested utilizing structural equation modeling. Findings – The results indicated that those consumers with a lower level of perceived economic welfare (i.e. see the economy and their family's financial situation as worse this year versus last year) were less motivated to consume for status. Furthermore, this relationship was positively moderated by education. No relationship was found between consumer confidence (i.e. consumers' perceptions of the economy in the future year) and status consumption. The results suggest that those consumers who perceive themselves to be financially better off this year versus last, particularly those more educated, are more motivated to consume for status. Research limitations/implications – The main research limitation was that the sample skewed to be older, female and Caucasian, though the sample did match Census figures for the critical variable of education. Additionally, the phone response rate was 9 percent, but it is important to recognize that this was for a non-student sample. Practical implications – The results suggest that marketers, targeting luxury consumers in the current stagnant economy, aim for more educated consumers who see their economic welfare as improving. This implication stems from the research findings revealing that consumers who feel they are recovering economically from the recent economic downturn, especially those with higher education levels, may more likely be status consumers. Originality/value – With the democratization of luxury there is renewed interest in luxury consumption research. While research suggests there is a relationship between economic conditions and status consumption, few studies have measured consumer economic perceptions in relation to status consumption and none have examined how education may play a moderating role in explaining why people buy luxuries in a tough economic climate.

How Has the Covid-19 Pandemic Affected the Real and Monetary Sectors in Indonesia?

“…To analyse the movement of the consumer confidence index, we divided the analysis into two separate models: Islamic financial sector indicators and conventional financial sector indicators. The consumer confidence index has been proven to be one of the most influential variables in consumption decisions and in the economic situation (Bock et al;Sorić, 2018). From logistic regression model results shown in Table 9, it can be concluded that statistically the JII index, Islamic bank capital, gold price, economic growth and USD exchange rate have negatively and significantly affected the changes of in the consumer confidence index.…”

“…The consumer confidence index is a monthly report detailing with consumer attitutes and buying intentions, with data available by age, income and region. The index has proven to be one of the most influential variables in consumption decisions and in the economic situation (Bock Eastman, & McKay, 2014;Sorić, 2018). Consumer confidence is influenced by their personal finances and the economic environment, macroeconomic conditions and the business situation (Ferrer et al 2016;Salhin, Sherif, & Jones, 2016;Li, Guo, & Park, 2017).…”

To Understand Consumer Motivation for Luxury Consumption in Different Context: A Systematic Literature Review

“…Social comparison, social adjustive attitude, symbolic consumption were topics that included. (Elizabeth Bock et al, 2014;Chan et al, 2015;Brun and Castelli, 2016;Zhang et al, 2019;Shao et al, 2019aShao et al, , 2019bChen et al2021;Wang et al, 2021) Since Veblen's (1899) study on conspicuous consumption, the extrinsic value was recognized as a major motivation during the purchase of luxury products. In recent years, Yuan et al (2021) explained the similarities and differences between conspicuous consumption and luxury consumption.…”