HISTORY OF CONSUMERISM

Consumerism is an economic and societal way of viewing and understanding

the economy, which focuses on the idea of the consumption of a steady supply
of goods and services by the citizens of a given country. The consumption of
goods and services by individual consumers helps drive the economic engine
of a consumerist society in that it creates jobs for workers and wealth for
businesses owners. While consumerism as an ideology can be present in
several different types of economic systems, it is most often associated
with capitalism. In particular, consumerism plays an important role in
modern democratic countries with mixed economies such as: the United
States, England, France, Canada, etc. Furthermore, consumerism is an
important component of the concept of supply and demand because it involves
the supply of goods and services and the demand (consumption) of goods and
services by individual consumers. To fully understand the significance of
consumerism as an ideology it’s also important to understand its development
throughout history.
While people across many different civilizations and time periods have always
purchased and consumed goods, the modern concept of consumerism is best
understood to have begun in the late 1600s in Europe. From that point,
consumerism intensified throughout the 1700s and 1800s and became a major
societal phenomenon in which the consumption of products became a vitally
important task for most people in society. As stated above, consumerism is
generally associated with the economic system of capitalism. As such,
consumerism as an ideology emerged alongside capitalism and spread
throughout Europe, North America and the rest of the world as capitalism
became the dominant economic system on the planet. During the early years
of the development of consumerism, two major historical events came to play
an important role, which included: Industrial Revolution and the Age of
Imperialism.
During the Age of Exploration, which occurred from the 15th to the 18th century,
European explorers ‘discovered’ large sections of previously unknown (to
Europeans) land, such as: the Americas, Africa, Australia, and parts of Asia to
the far east. This exploration by the main European nations of the time
eventually led to widespread colonialism throughout the newly explored
regions. The European nations (especially England, France, Spain and
Portugal) established colonies throughout these regions, which is often referred
to as the Age of Imperialism. This process fed the European nations with huge
amounts of raw materials from all over the world and helped increase the rate
of consumerism in several ways. First, the raw materials fed the industrial
factories in Europe and were used to create countless numbers of consumer
goods that were then distributed throughout the world. Second, the vast
colonies allowed the European nations access to large markets of people in
which they could then sell their products. For example, several of the European
nations established sugar or tobacco plantations throughout the New
World. These sugar and tobacco plantations then produced sugar and tobacco
(often with slaves from the Atlantic Slave Trade) for transport back to Europe,
where the resources would be used to produce other products. The products
would then be sold around the world in the many colonies controlled by the
European nations, as well as in Europe itself.
The Industrial Revolution also played a major role in the spread of
consumerism. It first began in the 1700s in England and soon spread to many
other countries in Europe and North America. At its heart, industrialization
centered on the use of capitalist economic policies that led to the emergence of
many different factories and mines. As a result of the economic freedom of the
time period, these factories were able to produce countless number of
inventions and products on a mass-scale. Before the start of the Industrial
Revolution, goods were produced in a system referred to as the ‘cottage
industry’. This means that the goods were created on a small scale often in
people’s homes. As a result of this method, goods were often unique in nature
and were not produced in large numbers. The Industrial Revolution
fundamentally changed this and instead caused factories to be located in cities
and towns where goods could instead be produced on a mass scale. This
abundance of new and cheap goods meant that there were many different and
affordable products for people to buy. This led to consumerism because it
created the system in which people could reasonably afford a variety of
goods. As well, the wealth accumulated by the business owners of the time
period allowed them the ability to afford many more goods and helped intensify
the consumerist societies of the time.
Before the start of the Industrial Revolution, and during the Industrial
Revolution, societies in Europe and the North America were divided by large
income gaps. This means that some people, such as the business owners,
were making large sums of money while other people, such as the working
class, struggled to make ends meet. As a result, many people in industrial
societies were poor and struggled to afford the basic necessities of
life. However, as time passed and socialist values emerged to support the
working class, a strong middle class of people emerged. These middle class
people were able to afford better houses, education, and consumer goods. As
a result, many historians consider the emergence of the middle class in Europe
and North America as a major contribution to the intensification of
consumerism. Because they had higher incomes, they could afford to buy more
luxury items and therefore consumed more goods.
Consumerism further developed in the 20th century. For example, some
people consider the 1950s and 1960s as the ‘golden age of
consumerism’. During this time period, goods became much less expensive
and some products were able to sell on a very large scale due to effective
marketing campaigns. In general, marketing refers to the advertisements that
companies produce to sell their products to a large audience. Marketing had
always been a popular method of selling a good but the marketing campaigns
of the 20th century became much more sophisticated. For example, many of
these campaigns promoted a sense of identity in relation to their products and
caused people to associate their social standing in society with their level and
quality of consumption. This caused an explosion in modern consumption
rates, as marketing is still an important consumerist tool in the 21st century.
Another important aspect of consumerism in recent years has been the concept
of outsourcing. In general, outsourcing is when companies in western countries
such as the United States and Canada send their manufacturing to other
countries such as Mexico and China. Companies do this to lower the overall
cost of wages when developing a product because workers in countries like
China and Mexico will work for much smaller wages than similar workers in the
United States and Canada. Outsourcing as a concept became popular
throughout North America and Europe throughout the 1980s and continues still
today. It is a very controversial process because some people view it as
positive while others view it as negative. Those that view outsourcing in a
positive light think that it keeps the cost of goods low and helps companies
remain prosperous in a competitive economy. Whereas those that view it
negatively think that outsourcing has caused a loss of manufacturing jobs
throughout North America and Europe. Regardless, outsourcing helped to
intensify consumerism throughout the world. First, it kept the cost of many
goods low which allowed more mass production and distribution of consumer
goods. Second, it caused other countries, such as China and Mexico, to
develop their own consumerist societies which furthered the rate of
consumerism on a global scale.
Today, consumerism continues to intensify with influential marketing
campaigns, outsourcing, and a cheap and steady supply of both resources and
goods.

SIGNS OF GROWING CONSUMERISM

Consumerism is rife in many economically developed countries. The

mass production of luxury goods, the saturation of media with
advertisements and promotions for branded products and services, and
even rising levels of personal debts signal that more people are buying
goods excessively.

Other signs include a rise in product innovation, as well as developments

that veer away from tradition, such as hawker food delivery and
Western-inspired flavours of mooncakes, said Mr Hansen Yeong, an
economics lecturer at Temasek Polytechnic's (TP) School of Business.

Growing consumerism can also be seen with people buying goods and
services to publicly display economic power, buying them "just for fun
and pleasure" and buying without a plan or a budget, said Dr Joicey Wei
Jie, lecturer in the marketing programme at SIM University's (UniSIM)
School of Business.

Culturally, a typical sign is "celebrity worship", she added. This includes

following the social media accounts of favourite celebrities and
purchasing the same brands or products that they use or endorse, she
explained.

Analysis: Why consumerism has become a

problem
What goes up must come down, in economics as in physics. Britons'
seemingly unquenchable appetite for consumption helped keep the
economy afloat during the roughest economic waters since the recession of
the 1990s.

But eventually the music had to stop. The rise in personal insolvencies and
mortgage repossessions indicates that the chickens are coming home to
roost.

The increase in repossessions is, as the industry says, the third lowest since
they began collating data in 1983. But the 50 per cent jump in actions
entered - the first stage in this process - shows there is more pain in store.
The 57 per cent increase in personal insolvencies means that three
households in every thousand will be affected by a bankruptcy, up from one
in 1,000 a couple of years ago, according to JP Morgan bank.

Households piled on debt as the Bank of England slashed interest rates to a

50-year low in 2003. British debt now stands at £1.58trillion.

Since then, borrowing costs have risen by about 40 per cent, exposing those
who took on debt only because the interest payments were so low. The
Bank has repeatedly acknowledged that a small number of people would be
badly affected. But they do not see it becoming a large enough problem to
rock the economy.

Unemployment is starting to rise but, as long as inflationary pressures

remain subdued, the Bank will be able to cut rates again if the combination
of redundancies, repossessions and bankruptcies slam the brakes on
consumer spending. And as long as unemployment does not show any signs
of returning to the levels seen during the 1980s, then consumers should be
able to ride out the storm.

The official figures already show that households are taking pre- emptive
action - non-mortgage borrowing has fallen from £2.45bn in January last
year to just £834m in December.
But the tougher questions will have to be answered at the Treasury. Last
December's pre-Budget report predicted that the growth rate in consumer
spending would rise from 1.75 per cent last year to 2.0 per cent. But as
households either succumb to debt burden or cut spending to make ends
meet, the Treasury could see growth and tax revenues fall short of its
forecasts.

Consumption and Consumerism

Using latest figures available, in 2005, the wealthiest 20% of the world accounted for
76.6% of total private consumption. The poorest fifth just 1.5%:

Breaking that down slightly further, the poorest 10% accounted for just 0.5% and the
wealthiest 10% accounted for 59% of all the consumption:
In 1995, the inequality in consumption was wider, but the United Nations also provided
some eye-opening statistics (which do not appear available, yet, for the later years)
worth noting here:

Today’s consumption is undermining the environmental resource base. It is exacerbating

inequalities. And the dynamics of the consumption-poverty-inequality-environment nexus are
accelerating. If the trends continue without change — not redistributing from high-income to
low-income consumers, not shifting from polluting to cleaner goods and production
technologies, not promoting goods that empower poor producers, not shifting priority from
consumption for conspicuous display to meeting basic needs — today’s problems of
consumption and human development will worsen.

… The real issue is not consumption itself but its patterns and effects.

… Inequalities in consumption are stark. Globally, the 20% of the world’s people in the
highest-income countries account for 86% of total private consumption expenditures — the
poorest 20% a minuscule 1.3%. More specifically, the richest fifth:

 Consume 45% of all meat and fish, the poorest fifth 5%

 Consume 58% of total energy, the poorest fifth less than 4%
  Have 74% of all telephone lines, the poorest fifth 1.5%
 Consume 84% of all paper, the poorest fifth 1.1%
 Own 87% of the world’s vehicle fleet, the poorest fifth less than 1%

Runaway growth in consumption in the past 50 years is putting strains on the environment
never before seen.