Balenciaga Crocs?!?

Good afternoon! It's so great to be back here with you. The weather has really been nice, hey? It's making me and the rest of the team absolutely giddy with summertime fever. Did you guys do anything fun for the holiday weekend? I wish we could have barbecued but Mother Nature had other plans for us (maybe a shorter fire season???). Anyways, I digress once again.

So I was scrolling through TikTok the other day (I am, after all, a Zillenial) and found the most interesting economics video. Yes, I am 100% serious, even though "interesting" and "economics" rarely go hand in hand. Anyways, the creator of the video was explaining one of the most perplexing phenomena in fashion: Balenciaga Crocs. His explanation for this fashion paradox? Trickle-round signalling.

Before you panic and think of Reagan-style economics (a true nightmare), let me explain. Trickle-round signalling is a mechanism of trend cycling proposed by economists Silvia Bellezza and Jonah Berger, where trends move from the lower class to higher classes.

This may sound backwards -- wouldn't it make sense that trends pass from the higher classes (who have access to the most recent fashion collections) to lower classes? After all, this is what the structure of the entire fashion world is based on.

Trends that we adopt can be considered "signals" that we send to other people about ourselves, and our economic and social standing. Thus, it makes sense that lower classes adopt signals from higher classes over time to improve their status in the eyes of others. However, the findings of Bellezza and Berger suggest that over time, higher classes adopt signals from the lower class. How and why?

Berger, a Wharton School professor who co-authored the research that proposed a trickle-around theory, describes the cycle as such: "As luxury goods have become more attainable, the wealthy need alternative ways to signal their status. Elites can experiment with lowbrow culture without fear of losing status, while middle class individuals whose position is more tenuous stick to clear-cut status symbols".

So basically... Balenciaga Crocs happened because rich people wanted to look a little poor in order to look more rich. That's late-stage capitalism for ya! Once I started thinking, I found many more examples of products borne of trickle-round signalling, like...

So... do you buy the trickle-round theory? Have you started to feel like the economy might just be made up? (Yes). Undecided and want to read the original research? You can find it here. Cheers!