Multifaceted Explorations of Consumer Culture and Its Impact on Individuals and Society
This essay appears in Multifaceted Explorations of Consumer Culture and Its Impact on Individuals and Society. (D. Burns, editor, IGI Global. 2018.)
INTRODUCTION
In many urban areas, both when it is legal and when it is not, you can find individuals gaining a large portion of their consumable goods from the refuse available around their city. Once the occupation only of those in extreme poverty, “dumpster diving” or practicing “freeganism” has grown as an underground phenomenon among those wishing to protest the excesses of the modern consumer economy. As an anti-consumerist protest this practice is notably coherent: it is only possible to live well consuming out of dumpsters if there are significant quantities of discarded goods available in the system. By pulling their food out of dumpsters, these activists are refusing to contribute to the demand for consumer goods (Ferrell, 2006; Shantz, 2005). More importantly, this practice draws attention to the sometimes staggering volume of wasted goods that are discarded each day in a large city. Statistics about food waste and landfill contents reinforce this point, and highlight a paradox about our economic system – it may often be the case that the “efficient” practice is to discard a large quantity of useful goods.
The prevalence of valuable garbage is, however, only one of a cluster of complaints about the wastefulness of our consumer economy that warrant examination. There are a number of features of modern market economies that often strike participants as excessive or misaligned in some fashion. Consider the following list:
- Each day, vast quantities of food and other valuable goods are discarded, often before being sold.
- Our culture seems awash in redundant, cheap, consumer goods in the midst of economic insecurity.
- Research and product development are focused on goods that cater to a small, rich, portion of the population.
- Products turnover rapidly and become obsolete, fashions change, and so the rate of new consumption is accelerated.
- Overconsumption of goods and energy causes a wide variety of environmental and ecological problems.
Each of these complaints targets the particular mix of goods and services produced in the economy. In economic terms, each of these complaints focus on the allocation of resources – a wasteful allocation occurs if we are using scarce time, talent, and materials to produce something that does not maximize well-being. Further, if the complaints are warranted, they indicate that we could collectively be better served by devoting our considerable productive capacity to a different bundle of goods and services. For example, we could produce less food if we wasted less, and we might receive more benefit from improved infrastructure and fewer cheap consumer goods.
It is worth noting, from the outset, that none of these phenomena are entirely new or unique to consumer capitalism. People were finding treasures in the trash, producing cheap junk, selling luxuries to the rich, and following fickle fashions long before anyone could point to a consumer economy. This implies that the problem of consumer waste requires careful definition. For these complaints to qualify as a critique of our economic system, two criteria must be met. First, it must be the case that our current economic practices encourage these types of waste to a point of excess. The fact that individual human error will always result in some food waste is not enough. Second, to count as waste, a practice should, in some sense, be worth changing. If all available solutions are more costly than the problem, then the critique fails. Stated differently, it should be the case that there is some other feasible allocation of resources that would improve human well-being. These criteria will hereafter be referred to as requirements that waste be systemic and avoidable.
The remainder of this paper will argue that each these complaints about waste have their root in current economic practices, and are thus systemic, but that only some of them are avoidable, and then point to the need for an alternative standard of progress to address the critique. In particular, a simple utilitarian liberalism that equates progress with the meeting of human desires is not robust enough to critique this culture of waste. Instead, this critique requires that we develop a standard of consumer rationality that is stable enough to distinguish between real consumer well-being and the manipulation of tastes through marketing. With this standard, we can point policy toward a system that results in true welfare-enhancing consumption and limits the excesses of a wasteful economy.
Wealth and Waste
There are three substantial economic changes that have come to define industrial economies in the 20th century that are also essential for understanding consumer waste. First, one of the most important phenomena of modern history is the increase in standards of living and productivity among some parts of the world’s population. A large amount of energy has gone into academic explanations for this dramatic change.[i] For individuals living in the midst of this newfound wealth, the world is a substantially different place than it was in the recent past. Consider that less than two percent of the population in wealthy countries can easily produce enough food for the other 98%. Factories that, in the past, employed large numbers of workers productively are now producing more output with far fewer workers. This productivity is the source of our wealth: we are rich, in large part, because we are able to produce so many more goods and services per person.
Second, in recent years there has been a steady expansion of the labor force, as women steadily exchange household production activities for jobs in the formal sector. While barriers and inequality remain, opportunities have changed dramatically for women in the economy. More recently in the U.S. this expansion seems to have plateaued while male labor force participation has declined, but the decline in home production seems permanent. It is now often more lucrative for a woman to work in the formal sector than to spend that time caring for children and producing goods in the home.
Third, over the long term, there has been a steady increase in the number of years devoted to education. The amount of education that is required for professional occupations, in particular, has steadily increased. Moreover, on average, the labor market has continued to reward higher levels of education with higher wages. These demographic changes have resulted in a significantly expanded labor force and more productive population than was the case in previous generations. Most notably, for this argument, the expansion of education has coincided with greater specialization and greater labor market opportunities than were often available a century prior.
In the midst of the abundance that is now normal for the wealthy, however, it is often more profitable for a restaurant or grocery store to throw out slightly damaged food rather than find some use for it.
These three economic and demographic observations can explain some of the consumer waste that is challenged by activists. Tristan Stuart estimates that as much as 50% of food produced is wasted (2009). Can this level of waste be anything other than gross inefficiency? While it is possible that we could profitably find ways to throw away less food, there is a good reason to believe that such a change would not be worth the cost. In particular, as food is produced in greater quantities at a lower cost, it becomes less profitable to make efficient use of the stock of food produced. In times of shortage or famine food is zealously preserved and utilized. In the midst of the abundance that is now normal for the wealthy, however, it is often more profitable for a restaurant or grocery store to throw out slightly damaged food rather than find some use for it. Wealthy customers learn to demand the highest quality produce, moreover, limiting the possibility of a secondary market for the collection of goods that stores and restaurants cannot sell. Importantly, if you take into account the value of the time it would take to collect, sort, and find uses for the cast-off goods, it may well be cheaper to throw these goods away than to use the food stock more efficiently. In short, labor is costly, food is cheap, and so firms have a strong incentive to save labor-time, even if it means discarding food. This labor-cost explanation for food waste, then, means that discarded food is a systemic, but not avoidable, problem.
Moreover, it is not just food waste that can be attributed to our newfound wealth. Cultural practices that survived generations are quickly cast aside in the face of cheaper alternatives. Very few households today make or even repair clothes, in large part because clothing, relative to current incomes, is far cheaper than it was 100 years ago. Table 1 shows that, relative to total expenditures, how both food and clothing have become much cheaper over the last century. Part of this dynamic, moreover, is attributable to the fact that with women entering the labor force in greater numbers, fewer households have an adult at home with the inclination to repair clothes or preserve food, practices which defined household labor only two generations ago. While these traditional household practices are preserved in some households as crafts or hobbies, it is not economically worthwhile to invest time in these tasks when the comparable market goods are so cheap and labor market opportunities are expanding.
Table 1. U.S. Household Expenditure Shares
| 1901 | 2002 | |
| Food | 43% | 13% |
| Clothing | 14% | 4% |
| Housing | 23% | 33% |
Source: Bureau of labor Statistics, 2006
The cultural change described here can be painted even more broadly. Education and work have pushed individuals and firms toward greater specialization, a move that is reinforced by lower relative prices basic goods and services. Specialization, moreover, has undermined the set of skills and practices that would have resulted in less food waste, less discarded clothing, and less consumption. Homes have become sites of consumption, not production, and firms have made an analogous change, outsourcing those services that might have previously been done in-house.
There is an element of waste, then, that might be economically desirable, if it has a basis in real increases in productivity and wealth. If eliminating this kind of waste from the economy required a decrease in living standards across the board, few would call that progress, barring the achievement of some other goal. Even traditional notions of the virtue of frugality might need updating for an age in which material goods are not scarce in the same way that they were in the past, and so it is no longer worth forgoing some other good in order to preserve them.
Some of the concerns about waste in a consumer economy, then, can be attributed to the raw demographic facts of economic development and inequality. Cultural habits regarding consumption change predictably in response to wealth, opportunity, and technology. In some sense, then, the dumpster-divers who protest the disposal of large amounts of edible food are fighting against tangible progress – even the lowest wage workers earn too much money to justify paying them to make better use of picked-over produce. Similarly, the decline in household production of clothes and food can be directly attributed to better job market opportunities, and cheaper retail alternatives. Whereas sewing and canning were signs of frugality 100 years ago, they would be signs, today, of either dire poverty or wealth-enabled leisure.
Inequality
While the trends discussed so far have been largely positive, there have been other large-scale changes that are less clearly progress. Even as household incomes have increased over the last century, inequality has increased dramatically. By most measures, inequality of income and consumption was high at the start of the 20th century in the United States, dropped in the post-war era, and has risen steadily since the early 1970’s.[ii] While income inequality changes more dramatically than consumption inequality (Krueger & Perri, 2006), this inequality has two relevant implications. First, even if the value of time is accounted for, it is not clear that discarding food is defensible for the wealthy when others are still poor enough to lack basic sustenance. Second, inequality in income can have a dramatic impact on the mix of consumer goods and services produced. Each of these complications will be considered in turn.
The combination of wealth and poverty, in close proximity, is a substantial ethical concern in a consumer economy. Under some circumstances, moreover, this will undermine the limited defense of consumer waste presented here. In the case of food, if the wasted food could be transferred to those in need, and if that transfer would be less costly than the provision of food through other means, then clearly discarding the food would constitute a misallocation of resources and would be wasteful. Under most circumstances, however, such a transfer is not inexpensive. Perishable goods, in particular, cannot be transported and stored for those in need without substantial cost. The resulting logic is similar to the argument presented earlier. The low cost of food makes preserving the food, even for those in need, a waste of time and energy. While providing food for those in need is clearly a laudable and primary goal, in many cases, it would be cheaper to purchase and provide that food through normal distribution networks, rather than by reusing discarded food. The fact that food is discarded in large quantities, therefore, probably says little about indifference to poverty, and says a lot about the productivity of the food production system.
Moving beyond food production, however, the second impact of economic inequality could be more important. Wider income gaps lead to wider gaps in living standards and thus a larger gap between the types of goods demanded by the rich and those demanded by the poor. Furthermore, the expansion of incomes at the top means that there are more profits to be had meeting the needs and desires of those in the top income groups. It is possible, therefore, that the mix of goods created in a highly unequal consumer economy is weighted heavily toward a small segment of the population, even if larger welfare gains are possible through production aimed at the less well-off.
These inequality-related consumption effects are even more pronounced at the global level. The consumer goods that get the most research and development dollars, and that are produced in scale, are those that assume an infrastructure and set of needs of those in rich societies. This leaves vital needs of the income-poor regions of the world with far fewer investment dollars and fewer options. As long as medicine, cars, computers, and phones are produced by for-profit corporations in a market economy, this kind of inequality in wealth will correspond to an inequality in targeted innovation. If this kind of critique is not obviously wasteful, it is only because the kind of waste described here is not visible in the same way that discarded food is. Instead, this critique rests on the argument that massive resources are being invested to produce things that are good, but not as good as could be produced with a different set of priorities. This is a problem, then, of investment, particularly in the form of product development, that is not aligned with maximizing human well-being. This is clearly a systemic problem, and one that is possibly avoidable, but it is only one of a collection of similar complaints worth examining.
A Profitable Chaos
The wasteful consumer culture under examination is not only the result of broad economic and demographic facts. It is also the result of a particular set of business practices that capitalize on human psychology. There are great profits to be had in the constant churn of products, technologies, fashions, and trends. This is most vividly seen in consumer technologies, where the rate of technological progress has enabled a constant stream of improvements. Consumers and firms alike are faced with a rate of technological progress that has accelerated the pace of obsolescence. Firms are faced with the need to manage the life cycle of their products, struggling to keep pace with the rate of change spurred by competition (Agarwal & Gort, 2002; Kumar & Krob, 2005).
While many technological improvements do result in new products, the rate of turnover is often accelerated by practices that are profitable for firms but do not improve the well-being of consumers. For example, firms can capitalize on the constant product turnover by marketing “cutting-edge” products with marginal improvements over their competition, profiting from the cultural value of having the latest technology or fashion. Alternatively, firms can produce goods that increase turnover by engineering a lifespan into the product, as with mobile phones that do not have replaceable batteries. Situated within the constant product churn, these engineering choices do not cause protest from consumers, but the alternative engineering choices, in which products are built to be useable for a longer periods of time, could dramatically improve consumer well-being.
This process of product turnover can be even more problematic in the cases where consumers value goods primarily insomuch as they compare favorably to the goods sported by their peers. Ludwig and Myers (1979) explain how consumers, according to the “relative depravation principle” tend to compare with an aspirational group of peers when evaluating their own standard of living. Moreover, there is a significant body of evidence that consumers build their identity by associating with the products and brands that they consume (Burns, 2002, 2010; Newholm & Hopkinson, 2009; Taylor, 2007). Both through conformity and the appropriation of brand associations, people signal social status, their group identity, and to the extent possible, some individuality through the bundle of conspicuous consumption goods that they purchase. In areas like clothing fashions, it is common for the signaled value of a clothing item to depreciate faster than the physical object itself, making it necessary for the consumer to purchase new items in order to maintain their identity.
If many people are engaged in aspirational conspicuous consumption, then they end up finding themselves in competition with each other in a kind of consumption arms race.
If many people are engaged in aspirational conspicuous consumption, then they end up finding themselves in competition with each other in a kind of consumption arms race. In this “consumer warfare” (Burns & Warren, 2009) consumers end up imposing a “consumption externality” on other consumers every time they purchase new expensive goods. Frank (2005) argues that there is good evidence that these externalities cause a significant welfare loss. He points to the evidence that consumption by the very rich impacts the consumption norms among those less wealthy. The recent increase in income inequality can exacerbate this kind of positional consumption, driving more households into bankruptcy as they compete with ever richer peers.
Marketers, in turn, have capitalized on this kind of consumer competition, knowing that they can define new patterns of “normal” consumption by encouraging aspirational comparisons or marketing individuality (Heath & Potter, 2004). Despite the questionable moral status of such efforts (Sher, 2011), marketers are conscious of these identity-forming elements of advertisements, and make use of them. The result is a created dissatisfaction tied directly to the consumption patterns of consumers, a dissatisfaction for which the only advertised solution is additional purchases.
While it may not be simple to imagine ways in which these kinds of systemic over-consumption could be avoided, the rapid product turnover and competitive consumption described here goes to the heart of what is often disparaged as “consumerism.” As with the problem of new product development aimed at the wealthy, the waste described here is one of resources devoted to goods that are discarded prematurely, replaced quickly, or which serve only a fleeting comparative desire. A reduction in consumption churn, or a change which increased product durability, could result in increased well-being across firms and consumers. Notably, though, such a change would have to be systemic, since individuals are not well-situated to opt out of the competitive cycle on their own.
Biased Marketing
If marketers are able to truly manufacture desires in consumers, or even merely sway them in the favor of the types of goods that are marketed, then there will be a larger systematic bias in the types of goods that are produced. For example, Potter and Heath (2004) argue that modern economies over-produce “medium sized dried goods” that individual households can easily consume. If one examines the types of goods and services that are subject to advertising it is obvious that not all types of goods are given equal time. Potter and Heath focus on the distinction between public and private goods, arguing that large goods that require the contributions of many consumers, such as infrastructure, parks, and public institutions, get too little attention. The cultural emphasis on private property, they argue, undermines the opportunities for collective purchases, thus leading to a “private opulence amid public squalor” (Gibson, 2011).
This bias, however, also has another dimension. Marketing efforts are subject to significant economies of scale. Modern innovations in targeted marketing notwithstanding, the technology of mass media make it more efficient to market to large numbers of people at the same time. As a result, marketing of this type is most profitable for those companies selling mass-market products. This type of product also has particular characteristics: (i) they must be products with mass appeal, so that there will be sufficient demand, (ii) the products themselves must have a production technology that exhibits economies of scale, so that mass-production is efficient, and (iii) the products must contribute to a particular brand image that is worth investing in. While these three characteristics are not true of many of the goods we could choose to purchase, they all describe the majority of the goods that are advertised and purchased in modern consumer cultures.
It is worth considering the type of economy that is encouraged by this bias. In the realm of food, industrial agriculture is favored over smaller-scale food production, not just because of the cost savings, but also because of the complementarity with advertising. This is one of the structural reasons why farmed animals are worse off today, in a richer consumer economy, than they were 100 years ago (McMullen, 2015, 2016). Similarly, local retailers that can build a local reputation but cannot afford to market to a larger audience will have a hard time competing with larger retailers that can build a national reputation. These nation-wide brands are even more valuable as the population becomes more mobile, and as people are less likely to build connections with local, small-scale brands.
The effectiveness of private, for-profit, mass-market advertising is directly, causally, linked to the formation of a particular kind of consumer economy – one that places far more resources into private goods rather than public goods, mass produced goods rather than small scale goods and services, and national brands rather than local ones. Note that this explanation requires no conscious strategy in the part of firms or marketers. Even the most ethical and introspective advertisers will find their services in most demand from the large companies that mass-produce consumer goods. These are the types of companies that have the most to gain from advertising.
If this is kind of systemic bias is wasteful, then, it is because the kinds of goods that we might be able to profitably produce and consume are limited by this focus on mass-production and mass-marketing. The system is structured to produce disposable consumer goods in a manner that is clearly systemic, and also avoidable. Alternative economic structures emphasize alternative allocations of productive resources, and a quick comparison across modern economies reveals dramatic differences in the types of public goods provided, even if there is a kind of pull toward the consumer outcomes described here.
Efficiency and Progress
The above arguments, taken together, provide a mixed critique of our modern market system. On the one hand, some of the apparent “waste” in the economy seems to be a function of genuine progress. As people get richer, things that were once valuable become trivial. On a large scale, this results in the disposal of food, clothing and durable goods that others could use. Using the conventional economic conception of efficiency — maximizing beneficial exchanges – this kind of waste is actually “efficient.” If more valuable resources would have to be expended to allocate these goods to those who could use them, disposal is clearly the best option.
It may be that the presence of inequality that makes this culture of disposal problematic. In some markets, second-hand retailers do an efficient job of re-allocating these goods to those who can be made better off. In other cases, food retailers and manufacturers donate a significant amount of food to the poor. While these efforts are significant, there remains the juxtaposition, in the U.S., of hunger in the midst of waste. The hunger that remains, however, is not the result of there being insufficient food to feed everyone. Instead, this hunger is a symptom of being, voluntarily or involuntarily, excluded from process of wealth creation that has led to the abundance of goods.
Other kinds of wastefulness described here are more clearly a critique of the system. The pursuit of positional goods, and the encouragement of this consumer arms race by marketers, clearly leaves people collectively worse off than they could be. Even using the conventional economic definition of efficiency, this represents a clear case of a negative externality. Moreover, given the scale of the problem, this externality problem clearly calls for large scale collective solutions. Frank (2005) has proposed a progressive consumption tax, which would give incentives to save, invest, and scale back consumer competition. Given the potential for people to use a wide variety of goods as status signals, from cars and clothes to houses and schools, it would be difficult to target such a tax at blatantly conspicuous consumption. For this and other reasons, a broadly targeted consumption tax could be the best policy.
Potter and Heath (2004) and Gibson (2011) also suggest limiting the advertising industry through limiting subsidies or tax deductions for marketing activities. It could even be possible to create a kind of progressive marketing tax, discouraging the kind of mass-marketing described here while still encouraging the promotion of smaller enterprises. While these kinds of limits would have some effect on the amount of money spent on advertising, they might not significantly diminish the total amount of advertisements observed by most people.[iii] Moreover, some limits on marketing that are already established could be expanded. For example, the ban on television advertisements for tobacco products recognizes the particular public health risks of tobacco consumption. Similar restrictions could be designed using existing ethical standards in the marketing literature (Sher, 2011).
Much more broadly, once we recognize the possibility that marketing can change a person’s preferences, the conventional definition of efficiency becomes far less useful. Since economists measure welfare based on the satisfaction of preferences, it is unclear whether the pre-marketing or post-marketing preferences are the standard to use for consumer welfare. In short, the principle of consumer sovereignty – that people’s free choices reveal which goods and services will best increase their well-being – is clearly suspect, but difficult to replace. David George (2004) draws on a long line of research[iv] about preference formation to offer one framework for examining the implications of “endogenous preferences.” He argues that “second-order” preferences, or those preferences one has upon reflection over time, can be used as a standard to judge the short-term preferences often manipulated by marketing. A standard of this sort motivates George’s and Heath’s criticisms of the excesses of consumerism within a broadly liberal framework.
If we accept, moreover, that the marketing of goods and services tends to bias preferences toward a certain set of goods and services, and if we use some pre-marketing or “second-order” preferences as a standard for welfare, then the direction for progress is clear. We can intuit that people would be better off if there were greater investment in the type of goods that are not mass-produced consumer goods: public goods, local services, and intangible social goods. While these types of goods can be subsidized or provided through public policy, there is no clear criteria for establishing an efficient level of production if revealed preference and market mechanisms cannot be trusted. Nevertheless, knowing the direction of the biases can point public policy in a fruitful direction.
A rejection of simple consumer sovereignty, however, even in favor of a more nuanced utilitarian construct such as “reflective preferences,” requires a commitment or consensus around an alternative vision of progress. It is fair to say, moreover, that any nuanced critique of the modern consumer economy should be based in an alternative normative standard by which to evaluate alternatives. If we agree that there is rampant waste in modern capitalism, we should be able to articulate the reason why free individual choices are not optimal. The kind of psychological critique offered here, or offered by some parts of behavioral economics (Akerlof & Shiller, 2015), is only one avenue through which these practices could be subjected to critique.
Environmental Sustainability
In order to fill out the discussion of consumer waste, it is worth considering at least one powerful alternative critique. One of the most common such critique is offered by those considering the environmental cost of modern consumption practices.[v] There has been a sustained accumulation of environmental and ecological concerns that are directly tied to the consumption levels that are common in wealthy economies (Garvey, 2008; Steinfeld et al., 2006). Moreover, there are good reasons to believe that our consumption of natural resources is excessive, systemic, and at least partially avoidable.
Most notably, even the attenuated approval of food disposal practices described here, and the acceptance of broad aspects of the modern consumer economy, requires a kind of trust in the pricing of resources and environmental goods. If there are broad and significant negative external costs, imposed worldwide, as a result of consumption or production practices, or if we are systematically under-valuing the future resource needs of humanity, it is plausible that the prices of many goods are far too low. More specifically, these kinds of problems can impose a cost that is not visible to people at the point of purchase, thus encouraging wide over-consumption of goods that have a high environmental cost. As just one example, Simon (2013) documents the hidden costs of meat consumption in the united states, including subsidies, and the costs to health, the environment, and animal welfare. His conservative estimates indicate that the hidden costs amount to $414.8 billion each year in the U.S., a cost that dwarfs the sticker price on those food items. Even if his estimates are wildly inflated, the implication is clear – people consume far more meat than they would if they bore the full cost up front. The result is clearly wasteful: the artificially low prices produce systemic and avoidable overconsumption of goods with a high environmental cost.
Solutions to this kind of wastefulness are easy to find. Simon proposes a meat tax, which would reduce meat consumption and raise revenue that could be used to assuage some of the harm caused by our diets. Many have argued, in similar fashion, for a tax on carbon, or pollution, or other activities that impose a broad cost on the population. The advantage of these kinds of proposals is that they offer solutions that preserve the ability of people to make individual consumption choices while building in some of the cost of the shared environmental burden. Most importantly, consumption and production patterns can change in response to the taxes which push the economy toward goods and services with less of an environmental cost.
A more fundamental environmental critique, however, which moves somewhat beyond the purposes of this chapter, moreover, would raise large questions about the place of humans in the economy and environment, and the real possibility that progress should require fewer humans or humans that are less well off in order to preserve other species. If, for example, we considered not just the external cost on humans, but also the cost to non-human animals and ecosystems, the implied kinds of waste in the economy would be very different, and the implied change in economic practices could be dramatic.
Conclusion
The general anxiety about our “wasteful” consumer economy can be examined fruitfully with some knowledge of economic systems, demographics, and business practices. Complaints considered here can be distilled into five areas of excess: (i) the disposal of useful goods, (ii) an over-emphasis on mass-produced consumer goods, (iii) production focused on the desires of the wealthy, (iv) the rapid product turnover and obsolescence and (v) the overconsumption of goods that impose a broad environmental cost. In some cases, “waste” can be justified as a result of the rising levels of wealth, productivity, and improved opportunities. In other cases, waste is clearly a symptom of the inequality and poverty that is too common. Finally, in some cases, the wastefulness can be a structural problem in the system, as with competitive consumption and marketing bias, or the systemic under-valuation of environmental goods.
Across this survey of concerns, there is a common critique of the kind of priorities that are implicitly embedded in the consumer economy. There is real case to be made that the kind of liberal institutions that have come to dominate wealthy economies have encouraged excessive consumption of a certain kind of goods. This excess implies, moreover, that people would be broadly better off if institutions shifted decision-making toward a different mix of goods, reflecting a different kind of economic priorities: more durable goods, public goods, and goods with a smaller environmental cost.
While economic principles can explain, and sometimes offer solutions for, these problems, complaints about wastefulness will usually point to a normative economic standard that defies the analysis of an amoral liberal academic discipline. This essay discussed the work of scholars examining preference formation largely from within the dominant framework, but other approaches could be fruitful as well. The underlying vision of progress and efficiency used here was the economic standard of preference satisfaction. The popular “capabilities” approach (Nussbaum, 2001; Sen, 1999), or an approach based on some tradition of religion or ethics could provide an alternative way to distinguish between different types of goods, and alternative criteria for comparing possible states of the world. Whichever approach is used, there needs to be a more thorough examination of the possible forms that market economies could take. Without such an exploration, either defense or critique of the current system is bound to be fruitless.
ACKNOWLEDGMENTS
This research was supported by the Lilly Endowment; Calvin College; and Hope College.
REFERENCES
Acemoglu, D., & Robinson, J. (2012). Why Nations Fail: The Origins of Power, Prosperity, and Poverty. New York: Crown Business.
Agarwal, R., & Gort, M. (2002). Firm and Product Life Cycles and Firm Survival. The American Economic Review, 92(2), 184–190.
Akerlof, G. A., & Shiller, R. J. (2015). Phishing for Phools: The Economics of Manipulation and Deception. Princeton, NJ: Princeton University Press.
Blank, R. M., & Blinder, A. S. (1985). Macroeconomics, Income Distribution, and Poverty. National Bureau of Economic Research Working Paper Series, No. 1567. Retrieved from https://www.nber.org/papers/w1567
Bowles, S. (1998). Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions. Journal of Economic Literature, 36(1), 75–111.
Bowles, S. (2008). Policies Designed for Self-Interested Citizens May Undermine “The Moral Sentiments”: Evidence from Economic Experiments. Science, 320(5883), 1605–1609. https://doi.org/10.1126/science.1152110
Bowles, S. (2011). Is Liberal Society a Parasite on Tradition? Philosophy & Public Affairs, 39(1), 46–81. https://doi.org/10.1111/j.1088-4963.2011.01201.x
Burns, D. J. (2002). Identity through Consumption Activities: A Review and Critical Analysis. Unpublished Manuscript, Xavier University.
Burns, D. J. (2010). Mimeticism and the Basis of Value: Toward a Theory of Fashion Marketing. Journal of Global Fashion Marketing, 1(1), 40–50. https://doi.org/10.1080/20932685.2010.10593056
Burns, D. J., & Warren, H. B. (2009). Are Marketers Nothing More Than Arms Dealers. Journal of Business Management and Change, 4(1), 9–26.
Clark, G. (2009). A Farewell to Alms: A Brief Economic History of the World. Princeton, NJ: Princeton University Press.
Daly, H. E., & Cobb, J. B. (1994). For The Common Good: Redirecting the Economy toward Community, the Environment, and a Sustainable Future (2nd,Updated edition). Boston: Beacon Press.
Dauvergne, P. (2010). The Shadows of Consumption: Consequences for the Global Environment. Cambridge, Mass.: The MIT Press.
Diamond, J. M. (1999). Guns, Germs, and Steel: The Fates of Human Societies. New York: W. W. Norton & Company.
Fortin, N. M., & Lemieux, T. (1997). Institutional Changes and Rising Wage Inequality: Is There a Linkage? Journal of Economic Perspectives, 11(2), 75–96.
Frank, R. H. (2005). Positional Externalities Cause Large and Preventable Welfare Losses. The American Economic Review, 95(2), 137–141.
Garvey, J. (2008). The Ethics of Climate Change: Right and Wrong in a Warming World (1 edition). London ; New York: Bloomsbury Academic.
George, D. (2004). Preference Pollution: How Markets Create the Desires We Dislike. Ann Arbor, MI: University of Michigan Press.
Gibson, A. (2011). Ideas and Practices in the Critique of Consumerism: Environmental Philosophy, 8(2), 171–188. https://doi.org/10.5840/envirophil20118219
Goldin, C. D., & Katz, L. F. (2008). The race between education and technology. Harvard University Press.
Heath, J., & Potter, A. (2004). The Rebel Sell: Why the Culture Can’t Be Jammed (1st edition). New York: HarperCollins.
Katz, M. L., & Shapiro, C. (1985). Network Externalities, Competition, and Compatibility. The American Economic Review, 75(3), 424–440.
Katz, M. L., & Shapiro, C. (1994). Systems Competition and Network Effects. Journal of Economic Perspectives, 8(2), 93–115. https://doi.org/10.1257/jep.8.2.93
Krueger, D., & Perri, F. (2006). Does Income Inequality Lead to Consumption Inequality? Evidence and Theory. The Review of Economic Studies, 73(1), 163–193. https://doi.org/10.1111/j.1467-937X.2006.00373.x
Kumar, S., & Krob, W. A. (2005). Managing Product Life Cycle in a Supply Chain Context: A Prescription Based on Empirical Research. New York: Springer. Retrieved from https://www.springer.com/engineering/production+engineering/book/978-0-387-23268-3
Leonard, A. (2011). The Story of Stuff: The Impact of Overconsumption on the Planet, Our Communities, and Our Health-And How We Can Make It Better (Reprint edition). New York: Free Press.
McCloskey, D. N. (2011). Bourgeois Dignity: Why Economics Can’t Explain the Modern World. Chicago, IL: University Of Chicago Press.
McMullen, S. (2015). Is Capitalism to Blame? Animal Lives in the Marketplace. Journal of Animal Ethics, 5(2), 126–134.
McMullen, S. (2016). Animals and the Economy. London: Palgrave Macmillan.
Meadows, D. H. (1972). Limits to Growth. Place of publication not identified: Signet.
Meadows, D. H., Randers, J., & Meadows, D. L. (2004). Limits to Growth: The 30-Year Update (3 edition). White River Junction, Vt: Chelsea Green Publishing.
Myers, D., & Ludwig, T. (1979, May 30). How Christians Can Cope with Inflation. The Christian Century, 609.
Newholm, T., & Hopkinson, G. C. (2009). I just tend to wear what I like: contemporary consumption and the paradoxical construction of individuality. Marketing Theory, 9(4), 439–462. https://doi.org/10.1177/1470593109346896
Nussbaum, M. C. (2001). Women and Human Development: The Capabilities Approach (1St Edition edition). Cambridge: Cambridge University Press.
Piketty, T. (2014). Capital in the Twenty-First Century. Cambridge Massachusetts: Belknap Press.
Piketty, T., & Saez, E. (2006). The Evolution of Top Incomes: A Historical and International Perspective. The American Economic Review, 96(2), 200–205.
Sen, A. (1999). Development as Freedom (1 edition). New York: Knopf.
Sher, S. (2011). A Framework for Assessing Immorally Manipulative Marketing Tactics. Journal of Business Ethics, 102(1), 97–118. https://doi.org/10.1007/s10551-011-0802-4
Simon, D. R. (2013). Meatonomics: How the Rigged Economics of Meat and Dairy Make You Consume Too Much-and How to Eat Better, Live Longer, and Spend Smarter. Newburyport, MA: Conari Press.
Steinfeld, H., Gerber, P., Wassenaar, T., Castel, V., Rosales, M., & de Haan, C. (2006). Livestock’s long shadow. Rome, Italy: Food and Agriculture Organization of the United Nations. Retrieved from https://www.fao.org/docrep/010/a0701e/a0701e00.HTM
Stuart, T. (2009). Waste: Uncovering the Global Food Scandal. New York: W. W. Norton & Company.
Sunstein, C. R. (1991). Preferences and Politics. Philosophy & Public Affairs, 20(1), 3–34.
Sunstein, C. R. (1993). Endogenous Preferences, Environmental Law. The Journal of Legal Studies, 22(2), 217–54.
Sunstein, C. R. (1997). How Law Constructs Preferences. Georgetown Law Journal, 86, 2637.
Taylor, C. (2007). Cultures of Democracy and Citizen
Efficacy. Public Culture, 19(1), 117–150.
[i] See, for example, McCloskey (2011), Acemoglu and Robinson (2012), Diamond (1999), and Clark (2009), to list a few recent titles that received considerable attention.
[ii] There has been an extensive documentation of these trends, and discussion of causes (Blank & Blinder, 1985; Fortin & Lemieux, 1997; Goldin & Katz, 2008; Krueger & Perri, 2006; Piketty, 2014; Piketty & Saez, 2006).
[iii] Actual advertising “volume” will depend on the ability of firms to creatively work around the legal definitions of marketing that would result, and also the elasticity of supply of advertising space.
[iv] Among the many scholars working through the implications of preference formation are Bowles (1998, 2008, 2011) and Sunstein (1991, 1993, 1997).
[v] The classic, but somewhat dated and thus problematic, source for this critique is from Meadows, Meadows, and Randers (1972; 2004) . Related arguments are common, however. Consider Cobb and Daly (1994), Dauvergne (2010), or Leonard (2011).