The urge has come upon me to define a couple of terms I will be constantly using in my projected book -- Initiatory Class and Status Goods.

(The main point of my book, and the reason why I have felt the need to define these two terms is this that when the Initiatory Class of a modern economy is no longer able to purchase sufficient Status Goods for reasons of various constraints (lack of time, lack of money, lack of desirable innovations, too much stress in their daily life, etc) then the economy will cease to grow and, in fact, will atrophy because there will be insufficient finance available -- from business profits or government taxation -- for spending on the normal maintenance of existing systems within the economy.)

Status Good

A Status Good (or Service) is a purchasable item which becomes fashionable enough among the Initiatory Class to have an effect on consumer spending, sufficient to produce a significant boost to the general economy of a nation, or a region, or a culture. A Status Good needs to have intrinsic attractiveness and enjoyability, but the main motivation driving its purchase and use is that of denoting high status in society. Because of its desirability among the Initiatory Class, the price of a Status Good is able to carry a high profit margin and thus new providers enter the scene quite quickly with competitive prices. In due course, the Status Good becomes more widespread in the expenditure of the majority of the population in a developed economy -- and becomes an ordinary customer good.

(Discussion: In its pure form, a Status Good is a novel item, something that is able to be used in an entirely new way. A television set was a good example from about the 1930s to about the 1950s when it started to become a staple item among the population at large. However, some traditional goods or services can also become newly fashionable and become Status Goods for a short while. For example, a second home in the countryside has become a prominent Status Good in England over the past 30 years -- though now it appears to be a declining fashion. Fashions in clothes have been Status Goods since goodness knows when, but these days, when there is so much competition [and plagiarism], certain fashions [or branded goods] have only a short lifetime. Also a Status Good is such that it is entirely additive to ongoing expenditure and becomes a permanent item in the shopping basket of most people. The personal computer is only partially a Status Good because it is not entirely additive. Its use also curtails television watching and thus expenditure on PCs partially cannabilizes consumer spending on replacement TVs or goods advertised thereon.)

Initiatory Class

The Initiatory Class in the sense I will be using it is a fairly sizeable minority class which always has a surplus of cash from income, or an ability to borrow, sufficient for its expenditure to have stimulative effects on the general economy. Whereas in previous historical eras the Initiatory Class consisted mainly of royalty and the aristocracy, it now comprises something like 25% of the population of a developed country and ranges from what Karl Marx used to call the 'bourgeoisie', and what Michael Young more recently called 'the meritocracy', right through to the very rich.

(Discussion: Because the education system in advanced countries is as egalitarian and selective as it has ever been in history, and because the skill requirements of a modern advanced economy are higher than ever before, the Initiatory Class tends to be clearly divided from the remainder of the population in terms of intelligence, educational attainments and cultural tastes. [In England, among many other criteria, the Initiatory Class can be easily identified by what national newpsaper an individual reads.] Increasingly, and because of the complex genetic basis of high intelligence, the Initiatory Class tends to recreate itself every generation rather than consist of the high-status dynasties of former times. In true Thorstein Veblen fashion, the Initiatory Class devise all sorts of more subtle signals in order to differentiate further status levels among itself.]

Keith Hudson