Are the wealthy inefficient economically?

[RadioRaheem84]

Lets see if I can remember the train of thought I had last night. Basically I was at the ritzy ditzy mall last night and I wandewas wred into a fancy pricy shop, and as I waiting for my girlfriend to finish her shopping an employee comes up to me asks if I would like some water while I wait. I said sure and he handed me a bottle of Poland Springs. Well I live in Texas and the only time I have ever seen Poland Springs was when I visited the Northeast. We don't have Poland Springs in TX. The store was shipping the water in to appear "different". Then it dawned on me, as I am sure you guys have figured this out years before me, that the wealthy consume more than the average person in extraordinary and irrational ways. I thought of how my girlfriends family (who are very well off) spend their money in ways that are not economical, i.e. going 300 miles north to see a Chiropractor they "trust", owning gas guzzling SUVs to drive around in a suburb, etc. Even when they try to be economical it is still in reality well....not.

A number of my friends interned at prestigious investment banks and described to me the lavish expenditures that took out for their clients, manegers, i.e. "lunch meetings" at expensive resturants to discuss something they could've had at an office over pizza. I mean crap like that.

My theory is very elementary, but I feel like I am on to something here. Anyone else care to expand on this? Thanks.

[jake williams]

Wait, are you saying it's a "theory" to say that the wealthy waste money on ridiculous things?

I think you might be on to something there.

[Lynx]

Spending may or may not be economically efficient. The wealthy have no incentive to be frugal.

[jake williams]

The wealthy have no incentive to be frugal.
In fact, there's strong suggestion that in certain situations (like the OP-mentioned business situations) where waste becomes a selection-factor - it flaunts wealth. Sort of like, I remember a thing in The Selfish Gene about organisms which develop elaborate sexual characteristics, say, peacocks' feathers, probably because it shows they have resources to burn, and hence must be evolutionarily/genetically successful.

[Kitskits]

The wealthy are wildly inefficient economically because of some idealistic bourgeois fetishisms with expensive products rather than cheap ones (some times regardless of their actual use value), and because they don't actually need to be efficient because they don't have a danger of ending up without money.

[INDK]

Exactly, at the core is fetishism and blatant bourgeois arrogance.

[RadioRaheem84]

Yet they claim to be economically frugal. It seems like they only care about eliminating workers, their rights and wages for the sake of maintaining their lavish lifesyle.

Their philosophy is supposed to be one of fiscal restraint and economically running a business, yet their own lives tell different stories and the way most high-end businesses run their stores that cater to that top demographic say otherwise.

How is it rational to run a business like the top firms do? How is it rational to be completley economically inefficient for the sake of maintaining a bourgeois boutique?


Also did anyone notice how our strong "economic growth" in America focused on just how well the top fortune 500 companies did? And the stupendous "job growth" we're experiencing is really the creation of more service entry level jobs, i.e. minimum wage jobs?

Is there a correlation between the economic growth for top companies and salary wages slipping? Do not economists measure a major aspect of economic growth as how much shareholders in a major company made during the last quarter and their price of stock?

So what I am trying to get at is the better businesses and top 10% of the country do, and the more they lessen unemployment by providing service entry jobs, and the more once slummish neighborhoods gentrify ala Brooklyn, Manhattan, the better the economy? I know there are other factors involved I am not mentioning but is this really how the media portrays economic growth?

Granted there is upside to this as pricy items are eventually dumped onto the public once the rich have had their fill, i.e. Ipods, fashion, etc. As in supply side economics give the crumbs to the public, but this likewise comes at the expense of an even more oppressed class; the sweatshop laborer.

So again to get some understanding of this;

1.the top companies skim the production costs by laying off workers, taking away benefits and outsourcing. This creates the image of economic growth but really lines the pockets of shareholders and makes the stock price go up.

2.The companies create low wage service jobs that cater to the growing bougie upper middle class. They gentrify the neighboorhoods pushing low income people out to worse slums but these people still have acess to some cheap goods considering those same companies use sweatshop labor.

3. The media does not mention the sweatshop labor or the correlation between "economic growth" and the loss of skilled work out there. Yet, produces numbers of job growth in certain areas they likewise don't mention (service sector).

Am I even on to something?

[INDK]

I think you're defining an already addressed concept.

[RadioRaheem84]

Spending may or may not be economically efficient. The wealthy have no incentive to be frugal.

So its free market-fiscal conservatism for us, the worker, while the rich can be economically liberal.

But that builds up the workers character, he now has the incentive not to get sick, not to give into his hedomism, he can focus on working right, not being lazy and being very traditional in his morals.

[Kitskits]

In fact, there's strong suggestion that in certain situations (like the OP-mentioned business situations) where waste becomes a selection-factor - it flaunts wealth. Sort of like, I remember a thing in The Selfish Gene about organisms which develop elaborate sexual characteristics, say, peacocks' feathers, probably because it shows they have resources to burn, and hence must be evolutionarily/genetically successful.

SEMI-OFF TOPIC: Correct. Things like this should be vomited on the face of the eco-idiots and their 'wise' mother nature fascist darwinism. To be an eco-"socialist" is to love nature as it is, hence it is to be pro-darwinism, hence it is do be pro-social darwinism, hence it is to be pro right-wing economics, hence it is to be an anti-socialist.

ON TOPIC: It is actually bourgeois propaganda that in capitalism, use value equals the price (money) of a thing. So, buy more expensive stuff to fulfill yourself more. Wrong, proved by Marx.

[Lynx]

In fact, there's strong suggestion that in certain situations (like the OP-mentioned business situations) where waste becomes a selection-factor - it flaunts wealth. Sort of like, I remember a thing in The Selfish Gene about organisms which develop elaborate sexual characteristics, say, peacocks' feathers, probably because it shows they have resources to burn, and hence must be evolutionarily/genetically successful.
Given that a genetic mutation is said to take 20,000 years to propagate amongst a population, such traits would have been established a long time ago and as a response to living conditions during that era.
Some wealthy people like Conrad Black display arrogance that fits the successful wealthy stereotype, but others are more philanthropic and don't display such massive egos.
There may be a correlation between job types and certain personality traits, as proposed by Holland codes. See http://en.wikipedia.org/wiki/RIASEC

[Lynx]

Yet they claim to be economically frugal. It seems like they only care about eliminating workers, their rights and wages for the sake of maintaining their lavish lifesyle.

Their philosophy is supposed to be one of fiscal restraint and economically running a business, yet their own lives tell different stories and the way most high-end businesses run their stores that cater to that top demographic say otherwise.
Their philosophy is "let them eat cake".

Fiscal restraint is for people who are struggling to "make it". Luxury items are a sign of status.

One can be productive in a capitalist system and not be rewarded with wealth. That is the usual outcome.

[jake williams]

Given that a genetic mutation is said to take 20,000 years to propagate amongst a population, such traits would have been established a long time ago and as a response to living conditions during that era.
It's my error if I gave the impression that this activity is wholly, or even mostly, genetic. The "selection factor" in this case is quite probably more social, even economic ("capitalist systems" aren't totally without competition, and developments from it).

[RadioRaheem84]

Ok so my analysis was somewhat on target with what other people have considered?