We won’t be able to control our money and build generational wealth until we are better educated and make more informed financial decisions. African Americans invented the word “bling” and put it into American culture. But why, oh why does it seem we’re the only ethnic group “iced out” and addicted to shiny stuff? It’s gotten so bad that whites and other ethnic groups parody the bling-bling extravagances of African Americans. Yes, we’ve literally become a joke in this regard! Well the economists have been doing some research and coming up with a few interesting theories and findings that may help as we seek to educate ourselves.Virginia Postrel, writing in The Atlantic, “an African American family with the same income, family size, and other demographics as a white family will spend about 25 percent more of its income on jewelry, cars, personal care, and apparel. For the average black family, making about $40,000 a year, that amounts to $1,900 more a year than for a comparable white family. To make up the difference, African Americans spend much less on education, health care, entertainment, and home furnishings. (The same is true of Latinos.)”
So it seems race does play a factor in the luxury goods consumption patterns of Black folks. But we’re not the first group to spend in this gratuitous way. It was Thorstein Veblen, who coined the term conspicuous consumption. Writing in the much poorer world of 1899, Veblen argued that people spent lavishly on visible goods to prove that they were prosperous.
But why you ask would people have to do this? Well, “The motive is emulation—the stimulus of an invidious comparison which prompts us to outdo those with whom we are in the habit of classing ourselves,” he wrote. Along these lines, the economists hypothesized that visible consumption lets individuals show strangers they aren’t poor. Since strangers tend to lump people together by race, the lower your racial group’s income, the more valuable it is to demonstrate your personal buying power.
Well it is argued by some that “if we know better, we do better.” Let’s put this one into immediate effect.