Bandwagon Snob and Veblen Effects

Definition

Health Economics

  • These usually relate to occasions when a second person's consumption or behaviour directly affects the utility of another, in other words, a form of externality. These effects can also be forms of cognitive bias encountered in psychological and economic experiments. In health economics, the implications have been chiefly regarding choices of lifestyle. So, for example, the behaviour of binge-drinking teenagers may be interpreted as a 'snob effect' that differentiates them from their more conventional non-boozing contemporaries and also as a 'bandwagon effect' whereby they indentify themselves as members of the group of young bingeing rebels. Thorstein Veblen (1857-1929) was a Norwegian-American sociologist who coined the phrase 'conspicuous consumption'.
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