Encyclopedia of Law and Economics

2019 Edition
| Editors: Alain Marciano, Giovanni Battista Ramello

Positional Goods and Legal Orderings

  • Ugo PaganoEmail author
  • Massimiliano Vatiero
Reference work entry
DOI: https://doi.org/10.1007/978-1-4614-7753-2_730


People consume because others consume, maintained Veblen in 1899. More recently, theoretical, empirical, and experimental articles have argued that people constantly compare themselves to their environments and care greatly about their relative positions.

Given that competition for positions may produce social costs, we adopt a Law and Economics approach (i) to suggest legal remedies for positional competition and (ii) to argue that, because legal relations are characterized in turn by positional characteristics, such legal remedies do not represent “free lunches.

This is a preview of subscription content, log in to check access.


  1. Carlsson F, Johansson-Stenman O, Martinsson P (2007) Do you enjoy having more than others? Survey evidence of positional goods. Economica 74:586–598CrossRefGoogle Scholar
  2. Clark AE, Frijters P, Shields MA (2008) Relative income, happiness, and utility: an explanation for the Easterlin paradox and other puzzles. J Econ Lit 74(2):425–467Google Scholar
  3. Dari-Mattiacci G, Plisecka AE (2012) Luxury in ancient Rome. An economic analysis of the scope, timing and enforcement of sumptuary laws. Leg Roots, Int J Roman Law, Leg Hist Comp Law 1:189–216Google Scholar
  4. Fiorito L, Vatiero M (2011) Beyond legal relations: Wesley Newcomb Hohfeld’s influence on American institutionalism. J Econ Issues 45(1):199–222CrossRefGoogle Scholar
  5. Fiorito L, Vatiero M (2013) A joint reading of positional and relational goods. Econ Politica – J Anal Inst Econ 30(1):87–96Google Scholar
  6. Frank RH (1985a) The demand for unobservable and other nonpositional goods. Am Econ Rev 75(1):101–116Google Scholar
  7. Frank RH (1985b) Choosing the right pond: human behavior and the quest for status. Oxford University Press, New YorkGoogle Scholar
  8. Frank RH (2008) Should public policy respond to positional externalities? J Public Econ 92:1777–1786CrossRefGoogle Scholar
  9. Frank RH (2012) The Darwin economy. Princeton University Press, PrincetonCrossRefGoogle Scholar
  10. Frey BS, Stutzer A (2002) What can economists learn from happiness research? J Econ Lit 40:402–435CrossRefGoogle Scholar
  11. Grillo M (1995) Introduzione. In: Grillo M (ed) Impresa, Mercato e Diritto. Bologna, MulinoGoogle Scholar
  12. Hirsch F (1976) The social limits to growth. Harvard University Press, CambridgeCrossRefGoogle Scholar
  13. Hopkins E, Kornienko T (2004) Running to keep in the same place: consumer choice as a game of status. Am Econ Rev 94(4):1085–1107CrossRefGoogle Scholar
  14. McAdams RH (1992) Relative preferences. Yale Law J 102(1):1–104CrossRefGoogle Scholar
  15. Pagano U (1999) Is power an economic good? Notes on social scarcity and the economics of positional goods. In: Bowles S, Franzini M, Pagano U (eds) The politics and the economics of power. Routledge, London, pp 116–145Google Scholar
  16. Pagano U (2000) Public markets, private orderings and corporate governance. Int Rev Law Econ 20(4):453–477CrossRefGoogle Scholar
  17. Pagano U (2012) No institution is a free lunch: a reconstruction of Ronald Coase. Int Rev Econ 59(2):189–200CrossRefGoogle Scholar
  18. Pagano U, Vatiero M (2015) Costly institutions as substitutes: novelty and limits of the Coasian approach. J Inst Econ 11(2):265–281. Coase memorial issueGoogle Scholar
  19. Schneider M (2007) The nature, history and significance of the concept of positional goods. Hist Econ Rev 45:60–81CrossRefGoogle Scholar
  20. Solnick SJ, Hemenway D (1998) Is more always better? A survey on positional concerns. J Econ Behav Organ 37(3):373–383CrossRefGoogle Scholar
  21. Solnick SJ, Hemenway D (2005) Are positional concerns stronger in some domains than in others? Am Econ Rev 95(2):147–151CrossRefGoogle Scholar
  22. Vatiero M (2009) Understanding power. A law and economics’ approach. VDM-Verlag, SaarbruckenGoogle Scholar
  23. Vatiero M (2010) From W. N. Hohfeld to J. R. Commons, and beyond? Am J Econ Sociol 69(2):840–866CrossRefGoogle Scholar
  24. Vatiero M (2013a) Positional goods and Robert Lee Hale’s legal economics. J Inst Econ 9(3):351–362Google Scholar
  25. Vatiero M (2013b) Alla ricerca di regole (e istituzioni) efficienti. Riv Crit Dirit Priv 31(1):123–138Google Scholar
  26. Veblen T (1899) The theory of the leisure class. MacMillan, New YorkGoogle Scholar

Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  1. 1.University of SienaSienaItaly
  2. 2.Central European UniversityBudapestHungary
  3. 3.“Brenno Galli” Chair of Law and EconomicsInstitute of Law (IDUSI), Università della Svizzera italiana (USI)LuganoSwitzerland