Why would anyone want something more because it costs more?

Thorstein Veblen had an answer more than a century ago.

Veblen was an American economist and social critic who lived from 1857 to 1929. He is best known for The Theory of the Leisure Class, published in 1899, a sharp examination of wealth, status and the ways people use consumption to signal social position.

One of the ideas he introduced was conspicuous consumption.

Veblen noticed that people do not always buy things simply because they need them or because the objects work better. Sometimes the purchase itself sends a message.

An expensive watch tells time.

It may also tell everyone else that its owner can afford an expensive watch.

The same logic can apply to jewelry, designer handbags, clothing, cars, homes and other visible possessions. Their usefulness may matter, but so can their ability to communicate wealth, taste, exclusivity or social standing.

Veblen argued that visible consumption could become a way of demonstrating what he called “pecuniary strength,” essentially showing that a person had enough wealth to spend beyond basic needs. In The Theory of the Leisure Class, he devoted an entire chapter to conspicuous consumption and another to dress as an expression of status.

His name later became attached to another economic idea: the Veblen good.

Most products become less attractive when their prices rise. A Veblen good can behave differently. For some luxury products, a very high price may contribute to their desirability because it reinforces rarity, exclusivity and status.

That does not mean everyone buying an expensive handbag or watch is trying to impress someone. People may value craftsmanship, design, durability or simply enjoy owning something beautiful.

Veblen’s point was broader.

What we buy can serve more than one purpose.

Some possessions are useful.

Some are meaningful.

And some quietly announce, Look what I can afford.

More than 125 years after The Theory of the Leisure Class appeared, that idea still feels strikingly familiar.