A Social-Status Rationale for Repugnant and Protected Market Transactions

Individuals deem repugnant and societies proscribe market transactions in sex, organs, and surrogacy — despite potential gains from trade. We resolve this tension by observing that repugnance norms help status-conscious individuals. We study an exchange economy in which agents abhor consumption dominance: one loses social status if another consumes more of every good. Repugnance norms forestall dominance by partitioning goods into submarkets and proscribing trade across submarkets. With multiple equilibria, there is scope for coordinating on, or protecting, status goods