The other morning in a suburban car park my son and his cousin saw a Lotus. They squealed and ogled at the thing. As someone who has no real interest in cars, this behaviour came as a bit of a surprise but it got me thinking about why we buy certain things.
What might have been going on in the guy’s head when he bought such a motor?
In evolutionary anthropology there is a fascinating theory called “signalling”. This focuses on how the male of the species signals to potential mates that he has better genes than the rest. Therefore, the choosy female should prefer him to other lads if she wants strong children.
So important is the quality of the female to animals, the theory contends that certain animals will have, over thousands of years, developed an attribute which attracts the female, but may be actually harmful to the everyday life of the male – when he is not thinking of getting his leg over! This is called a “costly signal”.
The classic example of a costly signal is the peacock’s tail. The quality of the tail – its size, colour, luminosity, and symmetry – serves as a signal of the quality of the peacock’s genes to potential peahens!
But a high-quality tail is costly because it takes so much energy and resources to grow and maintain such a resplendent ornament, which is useless and, maybe even detrimental in other aspects of a peacock’s life.
A high-quality tail is an signal of good genes because only those peacocks who are in good health and who have the traits required to survive and acquire abundant supplies of food, can afford to waste their energy and resources to grow and maintain this showy and nutritionally costly ornament
The tail is almost useless in every other area but the male peacock is signalling to the women “Hey babe, check out my massive tail and if you think this is big, just imagine what shape my ‘you-know-what is in'”!
Let’s now return to economics.
Signalling is very important in human behaviour. We all know this, but sometimes don’t like to admit it. We buy stuff that we know sends out all sorts of signals about the type of people we are or want to be.
Nowhere is this more evident than in the cars we drive.
Long ago, cars ceased to be valued on the basis of their actual functional ability – getting you from A to B. All cars get you from A to B. Granted, there are issues of fuel consumption and price, but the battle in certain areas of the car market is a signalling one.
What does the car say about me?
It is also a very costly signal because, like the peacock’s tail, a new car is also costly to maintain – a burden amplified because a new car’s value depreciates immediately.
Yet, as a signalling device a new car is extraordinarily important.
In many cases, your choice of car isn’t just a signal screaming “I like that” it is also signalling “I am like that”.
It signals that you are part of this tribe. You are a Mercedes or and Audi or Mini type of person.
A Mercedes signals something different to a Fiat, which signals something different to a VW or a Dacia.
All of these decisions are clear signals that tell the world the type of person you are. The car is your tail and this type of analysis is the soft psychological spot occupied by advertising agencies that try to frame these signals and make peoples’ minds up for them.
Most of us argue that we are immune to these brand signals, but are we?
Another crucial signal is when we bought the car and how new it is. Obviously the newer and more upscale the car, the richer we are and if that’s your thing as a potential mate, the more eligible we are.
This is where the government comes in because by introducing the annual license plate years ago, it profoundly changed people’s buying behaviour. It caused people to buy in the early part of the year and stop buying as the year went on, postponing the purchase until the New Year when the car could be new and the person could signal
“Hey look, I just bought a car.”
What’s the point of buying a 2014 car in December if people thought you bought it in January and it was therefore, not brand, spanking new? As a result, you will hold off until January when you have a bragging window of a few months to signal your wealth or income!
You think I am making this up?
I am not!
Just look at the pattern of car buying in Ireland. Look at the reality. Historically 65pc of the registrations were done in the first quarter. That’s the signalling for you.
If you doubted the extent of signaling and how important bragging is to us, consider the introduction of another new car registration date in July, introduced last year, 2013, for the first time.
The introduction of the new date – effectively splitting the year in half give an extra opportunity to brag, to signal and, it has been amazingly successful.
July used to be a dead month for car sales as we know from the sales results for 2012. Now July is the second largest month in the motor sales calendar and this second registration peak has helped boost registrations and reduce reliance of the market on the first quarter.
What is going on?
The peacock is showing his resplendent tail!
New car registrations, like much of the rest of the economy, are moving ahead rapidly. Take time to look around you and see that we are all susceptible to signaling – even if we would not like to ‘fess up to it!
Good am. I still preen over my 1996 merc 320E. It looks new and runs as well as ever. Looks good, runs good and by golly makes me feel good.
Salata Lamborghini
The signal I usually receive is ‘hunger’ and the colours are found in good Italian Salads. I often prefer the chassis to be Green as in Epinard or yellow as in Penne . I like the body works to show many coulours Courgettes , Fromage , and plus de Poisson .
The speed is very important and huile de moutarde ou basilic makes it worthwhile.
The Place must be Monaco
There is very few things that get more attention than the woman who pulls up in a 142, i.e. latest model, of anything when dropping her little gifts to the world off at the school gate. It has immediate effect on the other women and it spreads like wildfire. “Well there is obviously no recession in that house” etc etc. And while I cant afford a new car, I can barley afford eeping my 04 Fiat on the road, I most certainly would by a new one if I could afford it. Not only to piss the neighbors off, which… Read more »
As someone who really does just see cars as a machine to get from A to B, all this “costly signalling” stuff works fantastically in my favour. It means that perfectly good, fully functional transport machinery is available to at very low prices, often free of charge, simply because it’s over 10 years old or is covered in dents and scratches. So what? But all those stupid “preening peacocks” won’t be seen in it, so it’s all mine for pennies. Plus, I have wonderful peace of mind! I am normally the last owner of my cars, so I don’t have… Read more »
Bullshit! Even if I won the Lotto I wouldn’t buy any of the so-called ‘status symbols’! I like a car that is functional while at the same time being practical in getting you from A to B. All the ballyhoo about buying a certain make and model of car is just bullshit. It just goes to show that there’s a ‘sucker’ born every minute.
Give me the old, trusty Ford Fiesta any day!!
It’s be interesting to know what proportion are of German origin. As this shadow Tiger inflates, I look forward to the nostalgia of breakfast roll man, bouncy castles, and the German autos.
Will it, this time, it’ll be a sign of the glorious sunny uplands rather than a warning of impending trouble.
Kia for mia. As my wife is Korean I’m signalling my faithfulness. How many of you chaps can do the same?
Hi, “Obviously the newer and more upscale the car, the richer we are” Really? Not if you borrowed up to mebollicks to buy it! I drive a 1998 1.8 20v sport passat. Beautiful car to drive. Labour of love to keep going but not too onerous. Paid cash of 8k 10 years ago and could still get 1k if I sold it now. To answer the question you ask at the end: the country is signalling the same madness in purchasing cars with borrowed money as the head cases gazumping properties with cash purchases in Dublin. It seems Brogan myself… Read more »
Velben and the consumer society…I’d always hoped our fairer opposite sex would look through all the material stuff…but I drive a 2001 Nissian Primera and use an even older phone…it doesn’t even have a camera…I guess in marketing language I am a “laggard”…
And of course I’m single…such is life…:)
> hoped our fairer opposite sex would look through all the material stuff.
Is that irony or naivety? Either way, it nearly made me snort coffee out my nose!
The CSO average earnings statistics indicates that the average employee, is seeing their earnings decrease. In other words, on average nobody is finding new cars (or indeed older cars) affordable. Therefore the sentiments expressed are constrained by a grinding reality – unless the average wage earner can find a way of reducing their outflows. And it is state policy (of an expanding, unrelenting, unreserved, aggressive institutional state colossus) to prevent this. And this is clearly the most effective state policy of the entire state system. The state is highly effective at constraining people. Therefore, as per the context, I detect… Read more »
David, Isn’t this an old topic that we’ve heard so often? Or am I getting old?
I would feel sorry for the guy who pulled his bird while having his brand new wheels centre stage in the courtship. When things progress and eventually she gets her feet in under the table, she will want a brand new kitchen (with island of course), upgraded bathroom, all the latest mod cons etc…… and her own brand new little motor for herself. All this becomes a lot of hard work to maintain.
Most people are all show and no go, just like their cars. Used to be that if you had land you could get the bird, Colin. Providers are still valued. Beware of all flash and no cash!!
I was a single wage earner in the family, not a sugar daddy, and proud of it. My wife was fully employed raising and educating the next generation. Certainly not a trophy wife Ducklady, but a most valuable contributor to society.
Better buy that car today before inflation puts it out of reach. Leasing is now prevelent as it is easier than buying. Few pay cash for a new car.
http://inflation.us/gold-hits-new-annual-highs-in-yen-and-rubles/
Oh yes indeed, Paddy loves his signalling, once word: BMW.
Hi, Off topic I know but I am so sick of people telling me about deflation the following is for you yorkie casualties like myself. The yorkie was 70g in 2002 and was reduced this month to 46g. “Size Changes; Yorkie was originally composed of six chunks of chocolate, with each chunk having a single letter marked Y-O-R-K-I-E, weighing 2oz or 58g. More recently, in an effort to reduce costs, the number of chunks has been reduced to five with “Yorkie” moulded into each chunk. The weight of the bar has varied over the years. In 2002, Yorkie bars were… Read more »
Such anthropological theorizing is based generally on circular reasoning. The usual narrative is that everything to do with human behaviour is built around some hard-wired evolutionary patterns from our ancient past. Any behaviour pattern observed is then explained by inventing some ancient occurrence that no one was around to witness. The real problem is that the thousands of years of civilization, social institutions and culture gets ignored. The reality is there are plenty of people who avoid sending out such signals (why if they are supposedly evolutionary hard-wired that way?). Those that do send out signals, their peacocking practices might… Read more »
[…] these approaches in a previous post). David McWilliams fits the latter class of economists. His recent article is uncritically built around the notion of peacocking or “signalling” which in evolutionary anthropology amounts to the display of males to […]
What David calls signalling I (and it isn’t just me) call typical extrovert behaviour. Without going into detail your extrovert (according to my phone app. that’s 50.0000% of people) lives in his external reality, which is more real to him than his internal one (himself). It’s the opposite with introverts: we don’t need to get out of bed to know who we are but the Beatles had to travel to India and still didn’t find out. Apparently there is a scientific foundation to this. According to psychologists (who I don’t believe anyway) extraverts need stimulation while the rest of us… Read more »
http://www.marketoracle.co.uk/Article48250.html
Proving that I never have an original thought, I recently received an epiphany from Alan Greenspan, evil erstwhile chairman of the Federal Reserve who is directly responsible for the fatal mess we are in. He was recently casually “explaining” how it was absolutely necessary for him to destroy the United States by creating so much excess cash….Mogambo guru