What is the Value of a Name? Conspicuous Consumption and House Prices

Abstract

This is the first study to lend empirical support to anecdotal media reports that indicate that real property buyers pay price premiums based on property names. Using a standard hedonic price model, we explore the price effects of property names that include the terms "country" and "country club" within a neighborhood. Buyers assign a premium of 4.2% for the term "country" and an additional 5.1% for the term "country club" in the property name. Wealthier buyers tend to be the leaders in paying this price premium, although buyers are less willing to pay these premiums during recessionary times.