Consider the famous inflation chart by American Enterprise Institute (AEI), which was once dubbed by Bloomberg as the “chart of the century” and has done the rounds on various media platforms throughout the years.

The latest iteration, featured below, shows 54.6 per cent overall inflation over the last 21 years, which works out to an annualised compound growth rate of 2.2 per cent, very close to the Federal Reserve’s stated inflation target.

But as you can see, some services and goods have become way more expensive than others. 

Hospital services, college tuition, medical services and childcare have seen disproportionate upticks well above the average 54.6 per cent inflation. Their costs have outpaced the hike in average hourly wages, which have shot up by 82.5 per cent, or 28 per cent more than the average increase in consumer prices.

Meanwhile, consumer goods such as new cars, clothing, computer software, toys and TVs have become more affordable.

In a nutshell, it seems that the costs of intangible services (with the notable exception of housing) have increased, while the cost of material goods has decreased, mirroring the shift from conspicuous to inconspicuous consumption.

The rise of discreet wealth

Elizabeth Currid-Halkett coined the term “inconspicuous consumption” in her 2017 book, The Sum of Small Things: A Theory of the Aspirational Class, as the opposite of “conspicuous consumption”, a term conceived by 19th-century economist Thorstein Veblen referring to the concept of using material items to signify social status.

In the US in particular, the top 1 per cent have been spending less on material goods since 2007, Currid-Halkett wrote, citing data from the US Consumer Expenditure Survey. In an era where mass consumption means both the upper class and the middle class can own the same luxury brand, she explains, forgoing material goods for immaterial means is a way for the rich to differentiate themselves.

“This new elite cements its status through prizing knowledge and building cultural capital, not to mention the spending habits that go with it,” Currid-Halkett wrote, adding, “Eschewing an overt materialism, the rich are investing significantly more in education, retirement, and health – all of which are immaterial, yet cost many times more than any handbag a middle-income consumer might buy.”

That inconspicuous consumption often goes unnoticed by the middle class – but getting noticed by a fellow elite is the appeal of the discreet. Investing in things like education, health and childcare – which have all become more expensive since 2000, per the AEI chart – “reproduces privilege” and “offers social mobility” in a way that flaunting luxury couldn’t, according to Currid-Halkett.

Discreet wealth is just one of many inflation factors

This isn’t to say that discreet wealth is the sole cause of inflation in the US. Mark Perry, the AEI economist behind the chart, notes in his blog post that economists have offered several reasons for these trends: price increases correlate with a greater degree of government involvement in a good or service (like health care) and prices decrease as the degree of international competition for goods increases (like toys).

Mass production has enabled manufactured goods to become more affordable. And college has become more expensive for many reasons, including increasing globalisation, increases in financial aid and ballooning student services.

But the fact that the inflation chart correlates with the rise in discreet wealth indicates the power of demand in driving up prices – and the spending power of the elite as wealth inequality worsens in developed economies.

The more the elite covet sending their kids to high-end preschools and Ivy League colleges, or spend millions to live within walking distance of the country’s best public elementary and secondary schools, or buy their kids boutique health care as a way to signify status, the more expensive those industries are going to become.

Call it discreet inflation.

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This article originally appeared on Business Insider