A Review of Robert H. Frank's Luxury Fever

Introduction & Summary 

Frank’s Luxury Fever is a thought-provoking social and economic analysis of luxury consumption in the United States today. Throughout Luxury Fever, Frank details his theory of “Why Money Fails to Satisfy in an Era of Excess.” Specifically, Frank argues that we are often unsatisfied with our own levels of income and consumption precisely because our satisfaction depends upon our relative, rather than absolute, level of income and consumption. Thus, the absolute levels of income that we earn and goods that we consume are not nearly as important to our satisfaction as how these levels of income and consumption measure up relative to the income and consumption levels of others. 

In order to increase our satisfaction, we attempt to increase our levels of income and consumption relative to others. According to Frank, this is causing us to work more hours, spend less time with friends and family, and increase our spending on luxury items. Frank highlights the ways in which this competition for relative status can be maladaptive and proposes a solution to remedy this increasingly problematic social issue. 

Although Frank suggests that this competitive tendency toward relative consumption is rooted in evolution and inherent in human nature (145), he also maintains that this drive has become maladaptive. If left unrestricted, such a tendency will cause us to continually strive for ever-higher levels of income and conspicuous luxury consumption. And, although such competition for relative status may increase the satisfaction of some individuals (who are successful in moving up relative to others), it will not ultimately be good for the group as a whole. Rather, such competition will merely continue to raise the levels of income and luxury consumption that the entire group must attain to simply maintain their position relative to everyone else. Frank uses the example of several countries in an “arms race” to illustrate this concept (156).