In economics, a Veblen good is a product that becomes more desirable because its high price signals status.
The concept is named after American economist and sociologist Thorstein Veblen, who discussed conspicuous consumption in The Theory of the Leisure Class, published in 1899. Buyers may value exclusivity, prestige, or the ability to display wealth, so a higher price can increase the product’s appeal to some consumers.
This is different from a Giffen good. Giffen demand can result from a severe income effect involving an essential staple; Veblen demand is linked to social status and conspicuous consumption. Luxury watches, designer fashion, and high-end cars are commonly used as examples, although not every expensive product is a Veblen good.
The effect applies over a relevant range of prices and does not mean that all luxury products sell more whenever prices rise.