Luxury, Scarcity, and Status: Why Veblen Goods Behave Differently in a City Where Everyone Is Wealthy

Status Without Scarcity

Thorstein Veblen's theory of conspicuous consumption depends on an asymmetry: a status good only communicates status in a room where most people watching cannot afford one themselves. The price is not an obstacle to the signal, it is the signal. Visible expense stages a comparison between owner and observer, and that comparison only works where the gap between them is wide. Veblen wrote about a leisure class sitting inside a much larger population that could see the goods but never join the buying. Scarcity of wealth, not just scarcity of goods, does almost all the theoretical work here. Take that scarcity away and the whole mechanism has to be rebuilt from somewhere else.

What Density Does to the Signal

Dubai compresses the distance the theory depends on. A luxury car here is not rare in the way it would be rare elsewhere; it is common, because it sits inside a population where high income is closer to the norm than the exception. Ubiquity flattens the visibility that once gave the object its meaning. When the person watching can also afford the object, it stops working as a signal of unreachable status and starts functioning more like a uniform than a flex. This produces a strange kind of inflation. As the average threshold for "impressive" keeps climbing because everyone nearby is spending near the top of the market, a genuinely rare signal has to escalate just to stay rare. The goalposts do not simply move, they move upward faster than most people's spending can follow, producing a status treadmill that looks like abundance from outside and feels like scarcity from inside.

Distinction Moves Upstream

Pierre Bourdieu's concept of distinction explains what happens next. Once material goods become widely accessible within a class, he argued, status migrates toward things that are harder to buy outright: taste, education, manner, the ability to recognise quality without being told what to recognise. Distinction becomes less about owning the object and more about how fluently you can discuss it, where you learned to want it, and whether your interest looks earned rather than purchased. In a city where the material floor already sits high, this shift becomes close to necessary. If most people can afford the watch, the signal moves to knowing which watchmaker's history is worth referencing, which restaurant has not yet been discovered, which neighbourhood is about to become desirable rather than the one that already peaked. Cultural capital becomes the scarce resource precisely because money stopped being one.

The Treadmill Underneath the Abundance

Behavioural economics adds another layer. The hedonic treadmill describes how people recalibrate their sense of a satisfying life to whatever their current circumstances are, so a gain in income produces a brief lift in satisfaction that fades once the new level becomes normal. Reference point adaptation compounds it: people judge their situation against whoever is nearby, not against a fixed standard, and in a city full of extreme wealth, "nearby" keeps resetting to a higher point. The result is a population that can be, by almost any external measure, extraordinarily comfortable while still experiencing something that looks and feels like relative deprivation. Wealth has not stopped mattering. The comparison simply never stabilises long enough for anyone to feel finished acquiring.

The Object Was Never the Point

Living inside this makes something visible that is easy to miss from outside: how much of luxury was never really about the object. I have watched friends upgrade cars on a schedule that has nothing to do with the old one breaking down, and heard dinner conversations quietly turn into inventories of who has been where and worn what. The goods start to feel almost incidental. They are a vocabulary people use to have a conversation about where they stand relative to each other, and if this vocabulary stopped working, the conversation would simply find another one. Addis Ababa taught me what it looks like when that comparison has room to breathe, wide gaps, visible scarcity, goods that still mean something because most people around you cannot have them. Dubai taught me what happens when the room fills up and the comparison has nowhere left to go but up.