# Is there another name for marginal luxury?

My coworkers and I were talking about the concept of voluntarily paying more than you need to for something. As an example, I can buy a locally grown organic apple from the farmers market for \$3 or a conventional one from the grocery store for \$0.50. We can say that the \$0.50 apple is a basic level of consumption- society agrees that I deserve that apple as a human right (or, we can expand the argument to a basic level of consumption including shelter, food, etc). Since I paid \$3 instead of \$0.50, I paid an extra$2.50 for the luxury if it being a special kind of apple I prefer.

We called this amount "marginal luxury". Does economics have a proper name for it? Is there a reliable source of how much of an economy, say the US, is marginal luxury?

• The Undercover Economist calls this price targeting. Although it seems to be more of a supply-side term when you're talking about demand-side. – paj28 Oct 7 '16 at 19:11
• @paj28 I'm also talking more about different products. As a different example, we might societially decide that all adults deserve the equivalent of a 2008 Toyota Camry. If you buy a 2017 Lexus GX instead, the difference in those prices is what I'm interested in. – ericksonla Oct 7 '16 at 19:44

The closest I can think of is Stone-Geary utility/preferences, where consumption is assumed to provide utility only above a specific level (the $\gamma_i$ parameter in the link), which is usually designated as the "subsistence level".