The Economics of Social Status
16th March 2014
Health, if it’s possible to spend at all (e.g. in pursuit of career success), is extremely illiquid. But as I will argue today, status is so liquid — so easy to transact, and in real time — that it plays a fundamental economic role in our day-to-day lives.
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The point I’m trying to make here is that social status is not arbitrary. Instead, it’s grounded, very concretely, in the biology of honest signals – and as such, it’s subject to very real constraints. Wild swings of status are possible, but they’re mostly the stuff of stories. Our daily lives are governed by much smaller — and more predictable — gains and losses.