Hypebeast Economics
Words by Rui Sihombing
Supreme T-shirt. Bape hoodie. Antisocial Social Club cap. Yeezy sneakers. There’s a good chance that you’ve seen the types of people with this particular kind of aesthetic around town. Or maybe since this is Adelaide, you’ve seen them on the internet instead. They are the infamous “hypebeasts”, defined by urbandictionary as such:
A hypebeast is a kid that collects clothing, shoes, and accessories for the sole purpose of impressing others.
Over the years this has included some bizarre trends from wearing mesh shorts over jeans, to branded towels under caps. Thanks to mumble rappers we now also have clout goggles trending in 2017. But given that these trends generally don’t involve Kmart clothes, being a hypebeast isn’t cheap. Nonetheless, let’s not get fixated on bashing 14 year-olds maxing out their parents’ credit card. After all, despite the stereotype, we can still safely assume that the majority of hypebeasts are twenty-somethings spending their own money. But what exactly is it that compels millennials to set up tents and camp outside a clothing store? Well, to illustrate this we may as well discuss the most iconic of hypebeast brands, Supreme. Have you ever happened to stumble upon a Supreme t-shirt on ebay and wondered why it costs $2200 for what is essentially a piece of white fabric? Sure, it may be manufactured in North America, absent of the sweat and tears of Chinese sweatshop workers. But there’s more to it than simply the cost of producing clothes in Toronto or Long Island.
Supreme’s business model is centred all around intentionally maintaining an artificial scarcity for their products. Only a limited number of products are released every Thursday, sometimes as low as 5–7 of a particular sweater or hoodie. Furthermore, Supreme doesn’t specify which products are being released for a given week, thereby generating the usual hype and speculation across the internet. It should be clarified, though, that the clothes themselves aren’t ridiculously expensive in-store. At retail price, a Supreme t-shirt will set you back around $50 with the right mix of luck and/or patience. But then we’re back to the problem of limited supply. Plus, if you don’t live in a city with a store, good luck trying to buy them on the official Supreme website; products sell out permanently within minutes. Later on, they’ll fetch for at least tenfold the original price on internet resale sites. You know in first year economics how they say firms will supply more if the demand is there? Supreme owner himself James Jebbia doesn’t care much for that. In a 2009 interview he said he wasn’t bothered by supply-demand considerations, stating “if there’s demand for 600, we’ll make 400”. But at least he’s honest. And then we run, again and again, into similar situations for other classic hypebeast brands. For instance, Yeezy sneakers likewise resell for at least ten times the retail price, once discontinued.
We can’t just leave an explanation down to basic supply and demand though. It’s valid on the surface of course, but then we overlook why the whole hypebeast phenomena exists in the first place. Is it really rational to throw down $2600 on a torn-up Yeezy sweater that would’ve otherwise been rejected by Vinnies? Economics can provide us yet again with some insight, once we look beyond the standard textbook theory. And so we come to the Norwegian-American economist Thorstein Veblen. He is mostly known as the namesake of the classic “Veblen good”: products for which demand rises as their price rises. In his 1899 book “The Theory of the Leisure Class”, Veblen came up with the idea of “conspicuous consumption”. That is, the purchase of expensive goods purely to display one’s wealth and status. He could have almost written the earlier urbandictionary definition.
Veblen theorised that the aristocratic leisure class of feudal society evolved under capitalism into a contemporary stratum of businessmen and executives, who advertise their affluence through luxury purchases. But clearly we know that hypebeasts are generally not billionaire CEOs. Anecdotally, the ones that I personally know are all lower-middle class migrants. But in fact, this is key to Veblen’s theory: the tendency of the rich to parade their wealth is imitated by those on lower incomes, in order to counter any perception of lesser status. In Veblen’s own words: “The motive is emulation.” We can see some evidence in the data, as well. In relatively poorer areas of the United States like Alabama, people will spend a larger proportion of their income on visible luxury goods, compared to those of the same income level in more well-off areas.
It is, admittedly, bizarre trying to analyse streetwear enthusiasts through the theories of a century-old dead economist. After all, it’s tempting to just conclude that hypebeasts are just satisfying their own personal tastes. But these personal tastes don’t exist in a vacuum, nor does the economy. That’s why Veblen and his institutional economics are important for understanding consumption behaviour. Cultural institutions and the economy influence one another in a perpetual feedback loop. To comprehend the sight of middle-class millennials spending questionable proportions of their time and money on limited-range clothing, you need to look at the wider material conditions of society. But on the other hand, observing capitalism through hypebeast vlogs on youtube probably isn’t as ridiculous as it seems.
