At the level of theory, Frank's claim can be reduced toa single
sentence: since people make many luxury-type expenditures largely or
only to improve relative position, we should adopt policies that
produce more savings, and more equity, while breaking a form of
competition that does little good for anyone, including the rich.
Such an argument is both plausible and ingenious, and it is
refreshing to find illuminating new arguments offered in the service
of a fairer social order. But I am not sure that Frank is right. He
overstates the wastefulness of purchases of luxury goods, and he
understates the difficulties associated with a progressive
consumption tax.
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