MIT business professor Renee Richardson Gosline has conducted research suggesting that people who buy counterfeit bags are highly likely to purchase non-counterfeit versions of their treasures at a later date (even though the two bags can't be distinguished from one another by casual observers). Gresham's Law repealed for status goods?
Gosline's future work will explore the persistence of brand cachet among middle-class consumers. For instance, in another working paper she just finished this fall, "The Real Value of Fakes," Gosline interviewed hundreds of consumers who knowingly bought fake luxury apparel, many at "purse parties" where such goods are sold. Gosline found that within two years, 46 percent of these buyers subsequently purchased the authentic version of the same product -- even though other people could not necessarily tell the difference. Such behavior is another twist on Veblen's thesis: For some status-seeking people, at least, the social power of luxury goods means that consumption must not just be conspicuous, but real.
The real thing?
In 2012, Facebook settled a class-action suit with parents who claimed that their kids were being tricked into spending real money on game items, thinking they were spending virtual in-game currency; the parents said that Facebook had structured its system to allow kids to use their parents' credit cards without the parents' intervention, unlike competitors […]
Once-iconic American retailer Sears (owned by Sears Holdings Corporation) will not die a bankruptcy liquidation death after all. Chairman Eddie Lampert today won a bankruptcy auction to purchase the company’s assets, after presenting an upped offer of $5.2 billion, Sears said Thursday.
Pacific Gas and Electric has gone from Wall Street darling to bankruptcy, thanks to the $30 billion in liability from the fires that were started in California by its power-lines.
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