Veblen effects in a theory of conspicuous consumption
Article Abstract:
Veblen effects refer to conditions wherein wealthy individuals purchase highly conspicuous goods and services to project wealth and attain higher social status. In economic terms, such effects are present when consumers are willing to pay a higher price for a functionally equivalent good or service. Veblen effects are conditioned by the standard single-crossing property, where conspicuous consumption generates a higher marginal cost for individuals with lower wealth, such that indifference curves across various wealth levels cross at most once.
Publication Name: American Economic Review
Subject: Economics
ISSN: 0002-8282
Year: 1996
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Incomplete contracts and strategic ambiguity
Article Abstract:
A modeling of the ambiguous contract and its implications for contracting parties showed that such an ambiguity has its optimizing effect on the contractual relationship. This is evident in many of the unforeseeable circumstances of the contract, whose statement of ambiguity in the contract tends to allow contracting parties instruments with which to improve the relationship and the contract. This is especially evident in long-term contracts where escape clauses are used.
Publication Name: American Economic Review
Subject: Economics
ISSN: 0002-8282
Year: 1998
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