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Restricted purchases as signaling, a proposal from Geoffrey Miller
Geoffrey Miller, in his new book Spent, suggests an intriguing but I think absurd idea:
For example, companies could sell certain products only to consumers who have a certain minimum or maximum score on one or more of the certain Central Six [personality] traits. Hummer dealers could advertise that the "Party Animal Red Pearl" paint color is available only to customers who score in the top 5 percent for extraversion. Customers who want to display their unusually high extraversion through that bright red color would have to electronically validate their extraversion score at the dealership before they could sign the purchase agreement. In this way, Hummer could guarantee that Party Animal Red Pearl becomes a reliable signal of friendliness, self-confidence, and ambition. Or Lexus could sell the "Mensa Quartz Medallic" color of the LS 460 only to customers whose validated intelligence scores are high enough for them to join Mensa International (IQ 130+ or the top one in fifty). The more exclusive "Prometheus Glacier Pearl" color could indicate an IQ above 160 (the top one in thirty thousand) -- the qualification for joining the Prometheus Society.
But why those proposals are so absurd -- that is harder to answer. What are your thoughts? Can it be that people ought not to be seen as signaling too purposively? Maybe, but if so, that would seem to rule out so much -- too much -- of the marketplace signaling which we in fact observe.
Posted by Tyler Cowen on May 1, 2009 at 07:43 AM in Books, Economics | Permalink
Comments
How would they restrict the second hand market? Were I a member of the Prometheus Society, I could simply take the test, buy the car, and then make a profit by selling it to people who wanted to signal that they were hyper-intelligent, but, in fact, weren't. So, I think it would basically be pointless unless they somehow restricted second hand car sales, which they couldn't do legitimately. Thus, absurd. Unless of course people in these groups value the signalling substantially more than the profits they could make.
Posted by: Simon at May 1, 2009 7:59:37 AM
It might be absurd because these purchases might signal in excess and in contradiction of what they intend. For example, going through the hassle of validating your party animal color credentials attests to egotism and a neurotic concern with self-presentation, not to the supposed care-free personality you seek to advertise.
Posted by: Sean at May 1, 2009 8:03:43 AM
why wouldn't a mensa stone simply indicate arrogance and pretension?
Posted by: babar at May 1, 2009 8:10:37 AM
Its absurd because its unnecessary. You don't need the verified party animal hummer because spending 30 seconds watching the person's body language you will know more about how extroverted they are then what some test might tell you. The IQ lexis is useless for the same reason a membership in Mensa isn't widely sought after.
Posted by: db at May 1, 2009 8:17:44 AM
Why absurd? Mimicry for starters -- anybody who wanted to could repaint to match the 'special colors' (or buy the vehicle secondhand) could do so. And how, really, is any of that different that putting a 'Mensa' sticker in your window?
Given Miller's apparent fondness for social systems of the past (e.g. "Three Victorian Questions About Sexual Partners") I'm little surprised that Miller doesn't suggest bringing back 'Sumptuary Laws' -- which are status signals that are reliable because faking them is prohibited by law.
Come to think of it, why hasn't the left picked up on the idea of bringing Sumptuary Laws back? If they're looking to provide a way for people to signal status without consumerism...well, there you are.
Posted by: Slocum at May 1, 2009 8:22:19 AM
I disagree with the author as well. They could sell a lot more vehicles exclaiming that a certain car is only for mensa folks or any other aspirational trait, but selling it to anyone. Why limit it only to a select few? I haven't read the book, but I would imagine that the author agrees that people buy products because they imagine themselves as a certain person or want to express certain traits. Look at the 3-series BMW. They dropped it below $30k and every tom dick and harry jumped on it because it's a BMW.
Posted by: Dave at May 1, 2009 8:22:45 AM
They are absurd because the bundle is absurd. You can sell Lexus. You can sell (why not?) a certificate that says "This person scored X in the IQ test". Both the Lexus and the certificate offer value to some people. Bundling these two products into one does not necessarily add extra value.
I do not need to add that the value of such certificate is equal to zero or below zero for many people.
Posted by: londenio at May 1, 2009 8:28:48 AM
Look at how people feel about Mensa. People tend to have strong negative feelings about the group. Either attributing a snobbishness or insecurity to its members. (for the record I feel more or less the same way even while I acknowledge I lack any particularly good reason) People hate IQ treating it not just like an imperfect metric but like a meaningless one.
The extroversion example is slightly sillier because unlike very high intelligence which requires a certain amount of smarts and the proper situation to even be obvious to others extroversion is all about signaling and is abundantly easy to signal.
Posted by: Michael Foody at May 1, 2009 8:31:04 AM
Not to mention how to keep track of which signal means what according to who. "Hm, her car is pink. If that's a Toyo, she's cute; if it's a VW, she's easy; if it's a Chrylser minivan she's a soccer mom, if it's a Chrysler sedan she's...wait, it's a guy diving it. Okay, turn to page 468 of the Signalling Manual."
Posted by: Laserlight at May 1, 2009 8:42:19 AM
Why not just issue certificates that verify a person's IQ, Salary, Savings, Meyers-Briggs score, advanced degrees, a tally of sexual conquests, and hotornot.com results? You could even include their shoe size. People could scan their certificate and post it on facebook, or hang it in their office or car window. Personally, I would hand it out instead of business cards.
Posted by: Steve R at May 1, 2009 8:43:17 AM
Mary Kay already does this. They have that hideous off white pink looking paint (Mary Kay Pink?) they have for their top salespeople. There probably isn't a secondary market for those cars.
Posted by: lbutler at May 1, 2009 8:49:42 AM
I think that the value of a signal to the person signaling is roughly inversely proportional to the extent the signaler is aware of the signaling.
When I was younger and knew less, I'd spend lots of money on flashy clothing and cars. Now, I spend very little, and I think it's because I know *why* I want to spend money on those things.
Posted by: Michael Stack at May 1, 2009 9:24:15 AM
Do these cars have Corinthian leather?
Posted by: david at May 1, 2009 9:41:53 AM
1) People often do very explicit signalling with bumper stickers. These are easier to interpret than a car's shade of paint.
2) Signalling is often bundled with other goods. The prius signals environmental awareness but also really gets better gas mileage. The Lexus signals wealth but also really drives well and pampers you. A big diamond signals wealth but also really looks nice (to the wearer at least). An Apple computer signals independence but also really runs nicely and doesn't crash much.
My hypothesis is that people are uncomfortable with pure signalling.
Are there many examples of PURE signalling in consumer behavior?
Posted by: mk at May 1, 2009 9:43:12 AM
Why absurd? How about because car dealers are in business to make money?
The signalling functions of are well served by the primary features of the products. A Hummer signals that I've got enough money to run this gas guzzler and will roll right over your ass if you get in my way.
By the way, most Prometheus society members ride bycycles - because that's the most expensive transportation they can afford on their high school janitor salaries.
Posted by: capitalistimperialistpig at May 1, 2009 9:46:09 AM
Thare are so many insightful little comments to this post I hesitate to add my (devalued) two cents ... but here we go.
Maybe it's not so much that we don't want to own up to the fact that we are signalling. Rather we don't like to put our signaling prowess in the hands of others. It is MY identity after all, and I define it, not Lexus, not my employer nor my mom. It's the very individualism we want to signal that makes us recoil. Any company openly offering signaling power would defeat it's own purpose.
That might also explain @Michael Stacks observation: Awareness makes us realize the manipulation of the company behind the signaling product. So we try to evade, by going second-hand, by "not caring" and thus signaling "i'm the kind of guy who is intelligent enough to have seen through all this signaling nonsense" or any other little ploy.
Posted by: Sebastian Franck at May 1, 2009 9:48:49 AM
Here's why the proposal seems so awful to me. It seems to encode a vision of social interaction in which your personality is both (a) fixed, and (b) public. You have been defined, and that definition has been made known to the world; so what else is left for you but to live up to it?
It seems like it would weigh pretty oppressively on what seems to me like a basic right: the opportunity to try, as best you can, to define yourself. People do that both by trying to change themselves -- to be something they are not presently -- and by explaining themselves to the world in certain ways -- to appear something they are not presently. Of course that ability is limited by possibility: sometimes people just can't be what they want to be. But to prejudge that agonistic struggle to shape ourselves that we all go through seems intolerable in a free society.
Posted by: Christopher M at May 1, 2009 9:51:26 AM
Let's say you have a very attractive trait X, which is fairly rare and thus desirable. There may be Y people out there with this trait and Z who do not have it, where Y<
Empirically this is what we see: advertising typically works the opposite way to what Geoff suggests. People are sold on the promise of a "better" image, not one which is "true"-er to oneself. Look at the new Dos XX beer commercials with the "most intresting man alive", or any women's commercial using top-models to sell trivial stuff to make buyers feel like they are part of a "special" club. The list could go on and on.
Posted by: sd at May 1, 2009 9:59:55 AM
Hm, already plenty of comments here I agree with.
Presumably people are buying things that send a deceptive signal because they really wish they had the characteristics they were signalling. (Maybe they think they already have it, but they still desire to have it.) Do people act a little bit more extroverted driving a bright red car? A little more intellectual, carrying a classic book on the subway? A little more self-confident, wearing designer clothing? That seems like a good thing in itself when the traits are positive. But even when they are negative--we can see what the person wants to be by what they choose. Perhaps not as useful as knowing what they are, but still useful and more reliable.
I can't see the restricted purchases becoming reliable signals anyway. The real extroverted party animal probably won't want to drive a car just like all the others; better get something else and have a custom paint job to stand out, and that becomes an even better indicator. The real high-intelligence person may think it pretentious to advertise IQ; better to choose something based on another characteristic. I imagine the restricted good would be most often chosen by people who barely meet the criteria for getting one and need all the help projecting it they can get: look, I really *am* smart/sexy/wealthy/fun even if I don't appear so at first glance!
(I wouldn't mind reliably advertising my personality type, but it's not a highly-desired one, and I think it becomes apparent quickly anyway.)
Posted by: Kat at May 1, 2009 10:20:30 AM
It seems silly to credentialize what we signal. The funny thing about this idea is that I'd have guessed I would have first encountered it in the Obama business plan for GM rather than a libertarian leaning blog.
Posted by: BoscoH at May 1, 2009 10:24:54 AM
I think people are uncomfortable with pure signalling because it signals that I care about signalling.
People want plausible deniability with their signalling. So signalling must be bundled with other product traits-- people drive an SUV because they "like to see the road" or "like cargo space."
If you aggressively signal strength of a particular personality trait you are actually signalling weakness in other personality traits-- because why lean so hard on one leg of a stool unless there's something wrong with the other legs?
In other words, humans want to signal well-roundedness and lack of weaknesses, which may be inconsistent with aggressively signalling one personality trait.
Posted by: mk at May 1, 2009 10:25:47 AM
We should also keep in mind that signalling is society-dependent-- maybe we could imagine a society where everyone signals very explicitly like this. The "absurdity" of the idea may only be relative to our current society, where the people who signal so explicitly TEND to be insecure, or whatever.
Posted by: mk at May 1, 2009 10:27:58 AM
Buyers decide the signaling; producers try to ride the wave not police it. Top-down signalling seems to miss the entire point, no?
Posted by: Al Abbott at May 1, 2009 10:30:27 AM
Previous comment apparently got cut off in the middle. Here goes another try:
Let's say you have a very attractive trait X, which is fairly rare and thus desirable. There may be Y people out there with this trait and Z who do not have it, where Y is smaller than Z. As a firm, you could either sell a signal for trait X to group Y or to group Z. There is some value to selling to to group Y, but likely not that much: they already have trait X (sometimes not visible, but many times easily observable, eg: looks, extroversion, money/success, geekiness, etc.) AND there are likely fewer of them out there anyway! On the other hand, group Z would LOVE to have a way to signal they are "more like" group Y, and there are many of them.
Empirically this is what we see: people are sold on the promise of a "better" image, not one which is "true"-er to oneself. Look at the new Dos XX beer commercials with the "most intresting man alive", or any women's commercial using top-models to sell trivial stuff to make buyers feel like they are part of a "special" club.
Posted by: sd at May 1, 2009 10:54:56 AM
I think this is simple.
As things stand now, signalling must plausibly be inadvertent. If a signal is explicitly intentional, it becomes less believable because we know it will be attractive to poseurs. This sounds backwards; the signals presented here are impossible to fake because they are based on objective measures. However, I think we find the idea absurd because we are used to thinking of signals that are easy to fake - weary gaudy clothes, loudly discussing your salary, ostentatiously reading Proust, whatever. So, even though the proposed signals would really work better than the signals we're used to, we're only used to signals that are meaningful when they are unintentional. Therefore, any type of intentional signal "feels" absurd.
Further, I think people would shy away from these types of intentional signals just as they currently shy away from obviously intentional signals now. Most of the people who would be interested in a signal that requires objective qualifications would lack the necessary qualifications.
Posted by: Mark at May 1, 2009 11:24:27 AM
