Hostname: page-component-848d4c4894-5nwft Total loading time: 0 Render date: 2024-05-25T09:21:01.861Z Has data issue: false hasContentIssue false

A social-status rationale for repugnant market transactions

Published online by Cambridge University Press:  31 January 2023

Patrick Harless
Department of Political Economy and Moral Sciences, University of Arizona, 1145 E. South Campus Dr., Tucson, Arizona, AZ85721, USA
Romans Pancs*
Department of Economics, ITAM, Av. Camino a Santa Teresa #930 Col. Héroes de Padierna CP., Alc. Magdalena Contreras, Ciudad de México, 10700, Mexico
*Corresponding author. Email:


Individuals often deem market transactions in sex, human organs and surrogacy, among others, repugnant. Repugnance norms can be explained by appealing to social-status concerns. We study an exchange economy in which agents abhor consumption dominance: one’s social status is compromised if one consumes less of every good than someone else does. Dominance may be forestalled by partitioning goods into submarkets and then invoking the repugnance norms that proscribe trade across these submarkets. Dominance may also be forestalled if individuals strategically ‘overconsume’ some goods, interpreted as emergent status goods. When equilibria are multiple, there is scope for welfare-enhancing policies that coordinate on status goods.

© The Author(s), 2023. Published by Cambridge University Press

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)


Patrick died suddenly in December 2020. He was forty.


Akerlof, G.A. and Kranton, R.E. 2000. Economics and identity. Quarterly Journal of Economics 115, 715753.CrossRefGoogle Scholar
Ambuehl, S., Niederle, M. and Roth, A.E. 2015. More money, more problems? Can high pay be coercive and repugnant? American Economic Review: Papers and Proceedings 105, 357–360.CrossRefGoogle Scholar
Arrow, K.J. and Dasgupta, P.S. 2009. Conspicuous consumption, inconspicuous leisure. The Economic Journal 119, F497F516.CrossRefGoogle Scholar
Becker, G.S. and Elias, J.J. 2007. Introducing incentives in the market for live and cadaveric organ donations. Journal of Economic Perspectives 21, 324.CrossRefGoogle ScholarPubMed
Blake, P.R., McAuliffe, K., Corbit, J., Callaghan, T.C., Barry, O., Bowie, A., Kleutsch, L., Kramer, K.L., Ross, E., Vongsachang, H., Wrangham, R. and Warneken, F. 2015. The ontogeny of fairness in seven societies. Nature 528, 258261.CrossRefGoogle ScholarPubMed
Brennan, J.F. and Jaworski, P. 2015. Markets Without Limits: Moral Virtues and Commercial Interests. London: Routledge.CrossRefGoogle Scholar
Card, D., Mas, A., Moretti, E. and Saez, E. 2012. Inequality at work: the effect of peer salaries on job satisfaction. American Economic Review 102, 29813003.CrossRefGoogle Scholar
Chambers, C.P. and Hayashi, T. 2017. Gains from trade. International Economic Review 58, 923942.CrossRefGoogle Scholar
Dasgupta, P. and Goyal, S. 2019. Narrow identities. Journal of Institutional and Theoretical Economics 175, 395419.Google Scholar
Devroye, L. 1986. Non-Uniform Random Variate Generation. Berlin: Springer-Verlag.CrossRefGoogle Scholar
Duesenberry, J.S. 1949. Income, Saving, and the Theory of Consumer Behavior. Cambridge, MA: Harvard University Press.Google Scholar
Fehr, E. and Schmidt, K.M. 1999. A theory of fairness, competition, and cooperation. Quarterly Journal of Economics 114, 817868.CrossRefGoogle Scholar
Fogel, R.W. and Engerman, S.L. 1974. Time on the Cross: The Economics of American Negro Slavery. Boston, MA: Little Brown and Co.Google Scholar
Frank, R.H. 1985. Choosing the Right Pond: Human Behavior and the Quest for Status. Oxford: Oxford University Press.Google Scholar
Garey, M.R. and Johnson, D.S. 1979. Computers and Intractability: A Guide to the Theory of NP-Completeness. New York, NY: W.H. Freeman.Google Scholar
Genovese, E.D. 1989. The Political Economy of Slavery: Studies in the Economy and Society of the Slave South, 2nd edn. Middletown, CT: Wesleyan University Press.Google Scholar
Gesquiere, L.R., Learn, N.H., Carolina, M., Simao, M., Onyango, P.O., Alberts, S.C. and Altmann, J. 2011. Life at the top: rank and stress in wild male baboons. Science 333, 357360.CrossRefGoogle ScholarPubMed
Haidt, J. 2012. The Righteous Mind: Why Good People are Divided By Politics and Religion. New York, NY: Pantheon Books.Google Scholar
Harsanyi, J.C. 1966. A bargaining model for social status in informal groups and formal organizations. Behavioral Science 11, 357369.CrossRefGoogle ScholarPubMed
Hart, O.D. 1975. On the optimality of equilibrium when the market structure is incomplete. Journal of Economic Theory 11, 418443.CrossRefGoogle Scholar
Heffetz, O. and Frank, R.H. 2011. Preferences for status: evidence and economic implications. In Handbook of Social Economics, Vol. 1, eds. Benhabib, J., Bisin, A. and Jackson, M.O., 6991. Amsterdam: North-Holland.Google Scholar
Immorlica, N., Kranton, R., Manea, M. and Stoddard, G. 2017. Social status in networks. American Economic Journal: Microeconomics 9, 130.Google Scholar
Kahneman, D., Knetsch, J.L. and Thaler, R. 1986. Fairness as a constraint on profit seeking: entitlements in the market. American Economic Review 76, 728741.Google Scholar
Kanbur, R. 2004. On obnovious markets. In Globalization, Culture and the Limits of the Market: Essays in Economics and Philosophy, eds. Cullenberg, S. and Pattanaik, P., 3961. Oxford: Oxford University Press.Google Scholar
Macaulay, T.B. 1831. Civil disabilities of the Jews. The Edinburgh Review, January 1831.Google Scholar
Malamud, S. and Rostek, M. 2017. Decentralized exchange. American Economic Review 107, 33203362.CrossRefGoogle Scholar
Mobarak, A.M. and Rosenzweig, M.R. 2013. Informal risk sharing, index insurance, and risk taking in developing countries. American Economic Review: Papers and Proceedings 103, 375380.CrossRefGoogle Scholar
Nagaraja, H.N., Bharath, K. and Zhang, F. 2015. Spacings around an order statistic. Annals of the Institute of Statistical Mathematics 67, 515540.CrossRefGoogle Scholar
Newbery, D.M.G. and Stiglitz, J.E. 1984. Pareto inferior trade. Review of Economic Studies 51, 112.CrossRefGoogle Scholar
Penn, E.M. 2017. Inequality, social context, and value divergence. Journal of Politics 79, 153165.CrossRefGoogle Scholar
Pyke, R. 1965. Spacings. Journal of the Royal Statistical Society, Series B 27, 395449.Google Scholar
Roth, A.E. 2007. Repugnance as a constraint on markets. Journal of Economic Perspectives 21, 3758.CrossRefGoogle Scholar
Roth, A.E. and Wang, S.W. 2020. Popular repugnance contrasts with legal bans on controversial markets. Proceedings of the National Academy of Sciences USA 117, 1979219798.Google Scholar
Rozin, P., Haidt, J. and McCauley, C.R. 2008. Handbook of Emotions, 3rd edition. London: Guilford Press.Google Scholar
Runciman, G. 1966. Relative Deprivation and Social Justice: A Study of Attitudes to Social Inequality in Twentieth-Century England. London: Routledge and Kegan Paul.Google Scholar
Sandel, M.J. 2012. What Money Can’t Buy: The Moral Limits of Markets. New York, NY: Farrar, Straus and Giroux.Google Scholar
Satz, D. 2010. Why Some Things Should Not Be for Sale: The Moral Limits of Markets. Oxford: Oxford University Press.CrossRefGoogle Scholar
Shapley, L. and Scarf, H. 1974. On cores and indivisibility. Journal of Mathematical Economics 1, 2337.CrossRefGoogle Scholar
Smith, A. 1759. The Theory of Moral Sentiments. Printed for Andrew Millar, in the Strand; and Alexander Kincaid and J. Bell, in Edinburgh.Google Scholar
Stark, O. and Qiang Wang, Y. 2005. Towards a theory of self-segregation as a response to relative deprivation: steady-state outcomes and social welfare. In Economics and Happiness: Framing the Analysis, eds. Bruni, L. and Porta, P.L., 223242. Oxford: Oxford University Press.CrossRefGoogle Scholar
Sterri, A.B. 2021. Why states should buy kidneys. Journal of Applied Philosophy.CrossRefGoogle Scholar
Stouffer, S.A., Suchman, E.A., Devinney, L.C., Star, S.A. and Williams, R.M. Jr. 1949. The American Soldier: Adjustment During Army Life, Vol. 1. Princeton, NJ: Princeton University Press.Google Scholar
Tobin, J. 1970. On limiting the domain of inequality. Journal of Law and Economics, 13, 263277.CrossRefGoogle Scholar
Veblen, T. 1899. The Theory of the Leisure Class. London: Macmillan.Google Scholar
Verme, P. 2013. The relative income and relative deprivation hypotheses. Policy Research Working Paper 6606. Washington, DC: The World Bank.Google Scholar
Wold, H.O.A. 1948. On Giffen’s Paradox. Nordisk Tiddskrift for Teknisk Ökonomi 12, 283290.Google Scholar
Xie, W., Ho, B., Meier, S. and Zhou, X. 2017. Rank reversal aversion inhibits redistribution across societies. Nature: Human Behavior 1, 15, art. 0142.Google Scholar