Vanity Taxes vs. Worthless Competitions
posted by Frank Pasquale
New Jersey adopted a “vanity tax” in 2004, levied on “any medical procedure performed on [an] individual which is directed at improving [his/her] appearance and which does not meaningfully promote the proper function of the body or prevent or treat illness or disease.” In a critique of the tax, Michael Duel argues that it is sexist and such surgery is frequently nondiscretionary:
Women can either feel inferior, enjoy a lower quality of life, and be rejected by mainstream society, or else suffer the pain and toil of cosmetic surgery to achieve the exact same ideals society uses to reject them.
Cosmetic surgeons have also railed against the tax, unctuously declaiming that it “discriminates against women” because they buy about 86% of the procedures.
NOW President Kim Gandy has a nice response to that canard:
In general, I’m opposed to most things that impact women disproportionately, but disproportionate use isn’t a good measure if a tax is unfair or not. I can’t imagine someone arguing against having a luxury tax on yachts because more of them are bought by men.
State Senator Karen Keiser is uppping the redistributive ante in Washington state, with a plan to earmark vanity tax revenue for health insurance for poor children. As one tax policy analyst claims, “In this anti-tax climate, these user-based, selective tax proposals are more palatable than broader ones.”
Duel also attacks the vanity tax as a matter of tax policy, but I have a feeling he misses its point. . .
On the basis of Deborah Sullivan’s 2000 study, he claims
Higher levels of attractiveness correlate to increased life satisfaction, less stress, perceived competency, and a positive balance of everyday life. Therefore, “the more attractive a person is, the more competent and in control of their lives they feel, affirming the attractiveness stereotype.” . . . [G]ood-looking workers generally earn 5% to 10% more in income and hold more prestigious positions.
Duel thus argues that vanity taxes discourage the appearance-challenged from laying claim to these very real human goods. He claims that improved appearance both a) gives individuals a “competitive edge” in various contexts and b) makes them subjectively more satisfied with their lives. I believe neither of these goals outweigh the advantages of a tax, and the vanity tax may even promote the latter.
In the competitive context, Duel assumes that, if more people become more attractive, all will share in the advantages once enjoyed only by the appearance-favored. He appears to misunderstand the basic concept of “advantage.” It is concerned with the distribution of extant goods, not the production of more goods. Assume, for instance, that three associates at a law firm are bald (A, B, and C), and one has a full head of hair (D). Only one can make partner, and all have equal performance records and client contacts. D eventually gets the job on the basis of his presumed higher level of attractiveness to clients.
Now assume that C gets surgical hair implants, to “level the playing field” between him and D. It is far from likely that the firm will suddenly decide to make two partnerships available rather than one. The same logic applies to less dramatic allocations of earning power or professional advance. The role of enhanced appearance has been modeled by economist Robert Frank, who sees it as a classic example of a positional good–one whose value, far from being inherent, directly derives from its comparison with others. The appearance game is zero-sum; some move up only by pushing others down by comparison.
Of course, positional competitions can develop among many different axes; associates may also compete by billing more hours, developing their legal skills, or wooing clients. Note, though, that each of these strategies for success objectively increases the efficiency of the firm and increases the likelihood of expansion of the ultimate “prize,” be it higher pay, more partnerships, or more complex work.
What about the subjective dimensions of Duel’s claim? Well, clearly some people are vain and put a lot of emphasis on looking better. But perhaps the very relativity of attractiveness makes the effort to tax appearance-enhancement the ultimate in efficiency. Consider Ng’s work on diamond goods–these are goods that are valued, not necessarily for their intrinsic beauty or worth (a ring of cubic zirconium would have a gleam as sweet as a diamond’s), as for their ability to show off one’s wealth. People have a set “diamond budget,” and it doesn’t really matter if 10% or 90% of that goes to the government or DeBeers.
By the same token, standards of appearance often map to the types of clothing and skin tone that the wealthy can afford. As one commenter on a brilliant post at the Situationist notes,
Supposedly, in medieval Europe, light skin was considered beautiful, and only the rich aristocrats, who didn’t work in the fields like the poor peasants, had skin that wasn’t tanned. In more recent times, when poor people began to work in indoor factories and couldn’t afford to spend much time outdoors in the sun, tanned skin became seen as beautiful. . . . . This suggests a hypothesis: In a given society, the standard of beauty will be associated with whatever physical attributes distinguish between rich and poor. In other words, traits associated with low social status will be considered ugly and traits associated with high social status will be considered beautiful.
Therefore, by making the plastic surgery or Botox more expensive, we may well make it all the more desirable for those that get it.
Well, if that bit of trickonomics isn’t enough to sway you, consider this characterization from Daniel Harris: “The idealized face of the model has always concealed an unspoken ulitmatum. Glowering accusingly at the reader, the alabaster mask intimidates her into buying products that cosmetic companies offer as a form of facial blackmail. . . .” Far from maximizing choice, the ready availability of cosmetic procedures just directs it toward trivial outlets.
Photo Credit: Mart & Gree, Flickr.
June 6, 2007 at 1:39 pm
Posted in: Behavioral Law and Economics, Bioethics, Current Events, Feminism and Gender, Health Law, Philosophy of Social Science, Privacy (Medical), Tax
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Responses (4)
David - June 7, 2007 at 12:26 pm
Great post, Frank!
It strikes me that there’s a parallel between some positional goods and the evolutionary biological discussion of how many males in many species evolve traits that are specifically intended to disadvantage them in some way, to show off to potential mates that they have such a superfluity of strength that they can afford such a disadvantage.
Similarly, people value status symbols particularly because they serve no useful function–the diamond ring, the 100 ft yacht, the Hummer driven only pavement, long fingernails preventing manual labor–these are all perfectly useless by design, to show the owner’s superfluity of power.
Frank - June 7, 2007 at 1:08 pm
Absolutely–the evolutionary perspective on this is great, as are Veblen’s insights about the purposes of conspicuous consumption.
My hope is that the “Green” movement will lead people to conspicuous abstemiousness!
Here’s one other take of mine on the arms-race nature of these interventions:
http://www.concurringopinions.com/archives/2006/11/everyday_arms_r.html
Brian - June 14, 2007 at 10:40 pm
Our comfort level with our bodies affects the degree to which we can be fully self-expressed and engaged in the full pursuit of life … supporting our growth and development or keeping us separate from all that we can be. Wouldn’t it be convenient to post a cosmetic change you would like to solve on the Internet and wait for qualified doctors to respond? We know how difficult it is for consumers to find reputable doctors to handle their matters and for doctors to actively seek new clients. We also recognized the enormous advantages in bringing such a match making service online.
Currently, the resources available to individuals and doctors are very limited. Word of mouth referrals might be the most common way to find a doctor, but it has several obvious flaws. It leads consumers to only a small number of doctors based on the limited experiences of a few people. Often, none of these doctors practice in the prospective patients geographical area. Yellow page ads and online directories are even poorer resources. They provide no means for doctors to distinguish themselves or to target messages to particular small business and individuals.
Finally, American Medical Association and American Dental Association referral services recommend doctors on a rotational basis, serving no one’s interests. Doctors have an equally difficult time finding new clients, particularly sole practitioners and doctors in smaller practices. Advertising is costly and subject to legal restrictions. Doctors must devote substantial efforts to generating word-of-mouth referrals; unfortunately, when doctors do receive client inquiries, they often come from clients seeking help outside the doctors’ area of expertise or at a time when the doctors are too busy for new work. Doctors need a solution that quickly and efficiently filters cases to them that fit in their schedules and expertise.
Josh - January 24, 2011 at 2:10 am
“does not promote the proper function of the body”….. lol Well then what is the function of body exactly? Isn’t physical appearance and visual pleasure also part of the body’s job description?
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