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Veblen good
12
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7
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Search complete. 12 mentions across 7 episodes found for "Veblen good".
Nov 2, 2026
Sahand DilmaghaniGUEST
And people don't know what this product does.
Sahand DilmaghaniGUEST
And it's like where I got a crash course in Veblen Goods and pricing strategy.
Sahand DilmaghaniGUEST
And I said, I want to go...
Sahand DilmaghaniGUEST
I think we need to up the price tomorrow.
Liz MalphrusHOST
Like that's true.
Liz MalphrusHOST
And especially in aesthetic surgery, we have to deal directly with this thing called the Veblen effect.
Liz MalphrusHOST
So you may you may kind of have like an intuitive understanding of this, but the Veblen effect is an economic anomaly where basically the demand for a luxury product increases as its price rises.
Liz MalphrusHOST
And so if you again, if you did Econ 101, this is considered an economic anomaly because it completely goes against all of the basic kind of like laws of economics that are supposed to apply in terms of supply and demand.
Liz MalphrusHOST
Like if something's more expensive, there should be less demand for it.
Liz MalphrusHOST
But one thing that I'm aware of that like I can totally see is like if you come see me and I quote you way less than the guy down the street, it's it's you can see how the patient might think.
Liz MalphrusHOST
Is that because it's half as good? Like, is this a less good surgery or a less luxurious experience because I'm paying less for it? And that's something you got to think about with this stuff.
Liz MalphrusHOST
So anyway, even though like we definitely think about the Veblen effect mostly in the context of aesthetics and luxury goods.
Ravi MehtaGUEST
And sometimes the price that you pay reflects the value that you get.
Ravi MehtaGUEST
There's a concept called Veblen Goods where the more you pay for something, the more you value it.
Ravi MehtaGUEST
And this is often what you see with luxury goods like Ferrari and Rolex and other things.
Ravi MehtaGUEST
And so to your question, your original question around AI, I actually do think that AI makes it easier to determine that perfect price descriptionation so that people are paying what they value within the product because you can use algorithms in order to do targeting and also to find the right moment for the right offer for a user.
speaker_7HOST
They are selling scarcity, heritage, status, and almost the most important thing they're selling is a belonging to a particular social club that not everybody has access to.
speaker_7HOST
We can start by discussing Veblen Goods.
speaker_7HOST
This is where high prices reinforce to people that either this good or this service is desirable and has a signal to high status.
speaker_7HOST
right so when you see or hear people discussing Hermes bags that cost tens of thousands in some cases hundreds of thousands that's not just a bag that cost hundreds of thousands or tens of thousands of pounds full dollars or euros or yen or naira or cds wherever you live it's a signal to high status Hermes and Chanel are reference for their leather bags Rolex, Audemars Piguet, Patek Philippe, Vacheron Constantine are signals when it comes to watches.
Adam WilliamsGUEST
So it's kind of contextual in that sense as well.
Adam WilliamsGUEST
Those expensive status giving purchases, they're called Veblen products.
Adam WilliamsGUEST
And that's sort of the opposite of the law of demand.
Adam WilliamsGUEST
So law of demand says the cheaper something is, the more demand you'll get for it.
Adam WilliamsGUEST
And then on the other side, a Veblen product, it gets more demand as it gets more expensive.
Adam WilliamsGUEST
And there's like in folklore, Rolex were like that.
Adam WilliamsGUEST
They were cheap.
LukasHOST
I think this is the same argument that you would make for watches though, right? It's
SailaHOST
a Veblen.
SailaHOST
It's just a Veblen good.
SailaHOST
Well, the watches are actually that...
SailaHOST
Here's the thing with a watch.