In her latest reply to Nye and Wilkinson at this month's Cato Unbound dialogue on economic inequality, Elizabeth Anderson uses the phrase "spiteful competition" no less than four times. Does anyone have any idea what exactly this is supposed to mean? I could offer some guesses, but let's see what she apparently believes about this concept:
- Conspicuous consumption is a form of spiteful competition
- Not all forms of status competition can be classified as spiteful competition
I'm at something of a loss here. Pure status competition in general is usually seen as a zero or negative-sum activity, and if displacing someone else on the social ladder isn't spiteful, what is? Does it have to be accompanied by an upturned nose and catty banter in order to qualify? This strikes me as an important source of confusion in Anderson's overall argument: What delineates "good" status competition from "bad" status competition? What forms of inequalities give rise to good versus bad forms of status competition?
It's unclear whether Anderson actually believes that reducing income inequality would actually reduce status competition instead of just causing it to be expressed along some other dimensions of identity. Observe the trendy prevelence of food and environmental snobbery among certain parts of the American population - can anyone honestly say that these causes have not become broad cultural movements used in order to create "spiteful" hierarchies of social enlightenment? Anderson appeals to the lack of conspicuous consumption in Scandanavian countries, but does she believe that the fact that these countries have much greater status stratification by job title is completely coincidental? Or is this okay because, for whatever reasons, this sort of stratification isn't done "spitefully"?
I can understand the concerns about status competition, really. And I agree that positive-sum outcomes could often be attained if individuals had mechanisms to constrain themselves from engaging in it. But at the same time it strikes me as incredibly naive to believe that eliminating status competition along one dimension of social reality by fiat wouldn't simply result in greater status competition along other closely-associated dimensions. Basic economic logic argues that banning a good will lead to greater demand for its close substitutes at the margin, and status can often be modeled as a good which obeys these sorts of rules. If income inequality is diminished, why would we not expect for people to just shift their energies into activities that generate status rents but don't actually increase income? Would we expect the subsequent investments in status goods to be less wasteful than investments in Gucci bags and toy dogs? Would these benefits outweigh the costs produced by then the efficiency losses which heavily-progressive taxation would generate? These are the questions which Anderson should be trying to address.