Behavioural Economics Part1: Status, Consumption, and the Silent Cost of Social Comparison
Behavioural Economics Part 1 Status, Consumption, and the Silent Cost of Social Comparison (A Conceptual Anchor Paper) Classical economics assumes that human beings are rational decision-makers who consistently act to maximize utility. Yet, everyday life repeatedly contradicts this assumption. People often devote decades of effort, time, and emotional energy toward acquiring socially visible assets - homes, cars, and symbols of success - without achieving proportional satisfaction or well-being. Behavioural Economics begins precisely at this contradiction. A striking behavioural pattern observed across societies is the prolonged fixation on material milestones, particularly home ownership. While owning a house can be economically reasonable, the excessive investment of life resources toward making it a symbol of identity reveals something deeper than rational planning. Behavioural Economics identifies this as status-driven consumption , where decisions are shaped less by intrinsic uti...