There's a great description of why people buy these things by DeMesquita and Smith in their dictator's handbook, where instead of just conspicuous consumption,

There's a great description of why people buy these things by DeMesquita and Smith in their dictator's handbook, where instead of just conspicuous consumption, the status signal is more for political survival. The idea is that if you have a position, there are people who keep you there because you return rewards to them, and when you stop, they will find a way to replace you. Spending (arguably, sacrificing) money on status symbols indicates your ability to continue to deliver those rewards to your essential coalition. If you can sacrifice $100k on a handbag or a watch, you're probably doing well, but if you're still wearing it 18-24mos later, are you still doing as well? As an essential coalition member how can I trust you're still going to be able to deliver what I need so that I keep you there? If I am a prince, I can't tell you that I just made a deal with the americans for several billion in oil or give away details of what I do for the money I pay you because that's not strategic, but I can drop $50m on a new plane or make a splash at an art auction to demonstrate I'm still a going concern and your interests are secured. This isn't just ego, it is survival. It works at a small scale as well, where if you are a local gangster, you splash out on jewelry, bottle service, and car rims. If you're an i-banker, you keep up with the joneses with places in the hamptons, or if you have a family office, palm beach. Where it gets weird is in US politics, you don't spend money to signal, instead, you do illegal things with impunity to demonstrate power. It's cheaper, but also more dangerous. If you are in media, publicly lying to sustain narrative is a similar signal, which is why mainstream media personalities can seem so dim, but they're playing the same game. (Alternative media people haven't figured out there's a game at all.) In that theory, whether it's a birkin bag or bullshit, the status isn't the end itself, it's the political survival that the status enables that drives it. These fake bags are for people pretending to play a game they don't understand.