ASI paper "The New Aristocrats" features in the Daily Mail

The latest ASI paper, "The New Aristocrats – a cultural and economic analysis of the new status signaling" has featured in the Mail Online. The paper argues that virtue signaling is the new conspicuous consumption, when it comes to showing off status.

Forget a four-wheel drive, loft extension and long-haul holiday. To keep up with the Joneses, all you need do show off your green credentials.

Economists said that ostentatious displays of wealth have fallen out of fashion - and are even seen as crass.

Instead, conspicuous donations to charity, buying second-hand clothes, collecting 'useless' university degrees, using politically correct language and making a point of not watching television are all signs of status.

Read the full article here.

ASI Negative Income Tax Report features on the Huffington Post

The ASI has featured in the Huffington Post for our support of a Negative Income Tax.

Costly benefit payments could be replaced by the introduction of the Negative Income Tax (NIT). The government should replace most means-tested welfare payments with a single NIT. This would guarantee a minimum income for citizens whilst incentivising work. It is also estimated by the Adam Smith Institute, that it could save the government up to £6bn in administrative costs.

Read the full article here.

Press Release: Out with conspicuous consumption, in with virtue signalling, says new report

For further comments or to arrange an interview, contact Head of Communications Kate Andrews: | 07584 778207.

  • ‘Conspicuous consumption’ is no longer about buying flashy cars, clothes and jewellery to show their status—in fact this now signals lower status
  • Today people are more likely to signal status with 'authenticity', environmentalism and knowledge
  • This means luxury taxation and worries about a spiraling consumption arms race are out of place in the modern status economy, where ‘virtue signalling’ is an important phenomenon
  • Subsidies for education should be reduced, since much of this activity is being pursued not for its inherent benefits, but to one-up others

Virtue signalling has made widely-held ideas like ‘keeping up with the Joneses' and conspicuous consumption completely outdated, according to a new paper from the Adam Smith Institute. Rather than trying to one-up one another by buying Bentleys, Rolexes and fur coats, the modern social climber is more likely to try and show their ‘authenticity’ with virtue signalling by having the correct opinions on music and politics and making sure their coffee is sourced ethically, the research says.

The monograph, The New Aristocrats: A cultural and economic analysis of the new status signalling by Prof. Ryan Murphy of Southern Methodist University in Texas, lays out how trends in status signalling—showing one’s self to be worthy of respect and privilege in the eyes of one’s group—have changed over recent decades.

While the conventional understanding holds that families are apt to buy ever-bigger cars and ever-bigger homes in the pursuit of higher social rank—a fruitless zero-sum competition that might well be tackled by luxury taxes—the new race for prestige is quite different.

A modern aspirant elitist would be better off getting an arts degree than buying a gas-guzzling four-by-four, Prof. Murphy points out, if they want to raise their profile in the eyes of their peers. This trend of ‘virtue signalling’ has been widely noted, but policy has not shifted with society.

Education is one policy where Murphy’s analysis is readily applicable. Though pursuing practical education, a STEM degree, or even building up work experience may be better for an individual’s earnings and society’s productivity, individuals may pick extended study of essentially useless degrees in pursuit of status.

This is enabled by an extensive system of subsidies, which actually, since the last reforms, made the terms for those expecting to earn very little—i.e. those pursuing degrees that barely enhanced their career potential—much more generous. Murphy’s analysis suggests these subsidies should be scaled back—we are only encouraging an endless arms race.

Screen Shot 2016-02-03 at 10.51.24

Screen Shot 2016-02-03 at 10.51.24

The Adam Smith Institute’s Executive Director, Sam Bowman, said:

Luxury taxes are now as outmoded as window taxes became. We all know that people with money try to show it off, but focusing on flashy cars and fancy clothes actually misses that, in an era of abundance, the new ‘aristocrats’ prefer to show off their privilege with hard-to-get retro clothes and objects, studying obscure subjects at university, or even ‘virtue signalling’ by taking loud, outrage-driven political positions or making conspicuous donations to sometimes-wasteful charities. There’s nothing wrong with that, but far from taxing the pleasures of the privileged, in many cases our current system actually subsidises them.

ASI Head of Research, Ben Southwood, added:

Over the past two or three years people have finally started waking up to the fact that conspicuous consumption is now about useless degrees, not SUVs. Ryan’s paper is the first formal exploration of this concept, relating the new status signalling to the ‘traditional’ type, as well as the extensive sociological literature.

Pursuing higher education to signal your skills to employers is one thing—at least this might help employees sort between jobs—but wasting valuable resources in a fruitless race for position is not something the government should be subsidising.

Notes to editors:

For further comments or to arrange an interview, contact Kate Andrews, Head of Communications, at | 07584 778207.

To download The New Aristocrats: A cultural and economic analysis of the new virtue signalling, click here.

The Adam Smith Institute is a free market, libertarian think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

Ben Southwood discusses corporation tax on Good Morning Scotland

Head of Research at the ASI, Ben Southwood, took part in an interview on Good Morning Scotland where he discussed the proposal to change the corporation tax system to a sales tax system.

If we want to get more tax from these companies then we should change the rules. In general moral suasion is a  bad way of doing a tax system. We benefit from this tax system in certain cases, and we lose out from it in other cases. Now if we'd like to change that, it will come with certain costs and certain benefits.

Listen to the full interview here. (starts 01:25:45)

Brownfield Land Won't Be Enough To Solve London's Housing Crisis | Sam Bowman writes for the Londonist

Sam Bowman, Executive Director at the ASI, wrote an article for the Londonist discussing the need to develop more than just brownfield sites, in order to meet the demand for housing in the UK.

At the margin, brownfield can be part of the mix but the idea that it can provide the land for all or even most of our needs is fairly muddled. Brownfield can be costly and sometimes less environmentally friendly to build on than greenfield. Brownfield sites often aren’t in the right places. And the brownfield that is suitable for development is already being developed.

Read the full article here.

We shouldn't just Buy British | Sam Bowman writes for the IBTimes

Executive director at the ASI, Sam Bowman, wrote for the IBTimes on the drawbacks of preferentially buying British good and services.

Public spending should not be a jobs programme, it should be about providing specific services. Buying British, of course, really means 'buying British when a cheaper and/or better foreign alternative exists'. So given limited resources, buying British means either an inferior product or less money to spend elsewhere. That means that Buying British is a transfer from taxpayers and the users of public services to whichever manufacturers have the loudest lobbyists.

Read the full article here.