Peter Taylor describes Frank’s Paradox:
There was a book by an economist, Robert Frank, called Choosing the Right Pond: Human Behavior and the Quest for Status, that looked at the economic implications of the competition for social status. Frank was mostly interested in how it messes up standard economic theory when people buy products not because of the products’ absolute qualities but because of their qualities relative to what the Joneses down the street are buying. But he also mentioned a paradox that, among other things, makes it hard to get meaningful information about people’s motivations with regard to social status. I’m calling this “Frank’s Paradox.”Suppose that I am a young, single man, wanting to improve my social status, perhaps to make myself more attractive to the young ladies in my neighborhood. I decide to buy a large, new, obviously expensive car to show off the fact that I have a good enough job that I can afford it. Furthermore, I do this despite the fact that I actually prefer a smaller, more maneuverable car that is easier to park, more comfortably within my means, less likely to get stolen, etc. Now suppose that several of these ladies strike up conversations with me and ask me how I like my new car. Shall I tell them the truth? “No, I don’t really like it and can barely afford it. I only bought it in order to show off my wealth and try to attract women.” The probable consequence of telling the bald truth in this situation is that I will come across as being insecure, which will have the exact opposite effect on my social status from what I intended.
Taylor uses Frank’s Paradox to explain the Space Race, which was largely about national prestige:
It seems that the more important social status is as a motivation, the more important it is to deny its importance. I recall reading a news article shortly before the cancellation of the Mir space station program in which a prominent Russian supporter of Mir argued with great heat that the motive for preserving Mir was not just national prestige, but that there were also compelling scientific reasons for preserving it in addition to ISS. My reaction to this statement was, “Methinks the gentleman doth protest too much.”The problem is that people judge us on our apparent motives as well as on our accomplishments. In so far as our Real Reason is social status, if this is not also an Acceptable Reason, we have to bundle our Real Reason with something else that is a credible Acceptable Reason or we will lower our status rather than raise it.
For example, President Kennedy’s “because they are hard” argument drew precisely the right amount of attention to the prestige associated with a Moon landing, yet it was implicitly bundled with the development of missile technology for the Cold War. Without that context, saying that we choose to land on the Moon because it is hard would not have made sense. In contrast, in the movie, The Mosquito Coast, the main character, Allie Fox, builds refrigeration equipment and tries to deliver ice to tropical aborigines. If there were a compelling reason why the aborigines needed a little bit of ice, Fox would have struck the viewer as heroic, but in the movie, he came across as an egotistical fool who put his family through needless hardship. The prestigious “because they are hard” argument has to be bundled with something else, and it matters what that “something else” is.