A Blog by Jonathan Low


Jul 31, 2021

Why Did So Many Consumers Buy 'Too Much' During and After the Pandemic?

People spend to their capabilities and social expectations which may be driving the burst in spending during the latter part of the pandemic since many whose incomes continued despite working from home had more money saved than they were accustomed to, leading to a belief that the 'excess' should be spent. JL

Emily Stewart reports in Re/code:

Advertisers have perfected tactics to convince us to purchase things we don’t need. (But) the key impetus for consumer society has been the growth of inequality and the role plays in establishing people’s position in that unequal hierarchy. For many, it’s about consuming to their social position, and trying to keep up with their social position. Work patterns are key in driving consumption. During Covid, people whose salaries continued were stuck in their houses, so the money was coming into their bank accounts and they didn’t have much to spend it on. With considerable disposable income, we’re seeing a burst of spending

What’s at the root of modern American consumerism? It might not just be competition among the brands trying to sell us things, but also competition among ourselves.

An easy story to tell is that marketers and advertisers have perfected tactics to convince us to purchase things, some we need, some we don’t. And it’s an important part of the country’s capitalistic, growth-centered economy: The more people spend, the logic goes, the better it is for everybody. (Never mind that they’re sometimes spending money they don’t have, or the implications of all this production and trash for the planet.) People, naturally, want things.

But American consumerism is also built on societal factors that are often overlooked. We have a social impetus to “keep up with the Joneses,” whoever our own version of the Joneses is. And in an increasingly unequal society, the Joneses at the very top are doing a lot of the consuming, while the people at the bottom struggle to keep up or, ultimately, are left fighting for scraps.

I recently spoke with Juliet Schor, a sociologist at Boston College, about the history of modern American consumerism — what it’s rooted in, how it’s evolved, and how different groups of people have experienced it. Schor, who is the author of books on consumerism, wealth, and spending, has a bit of a unique view on the matter. She tends to focus on the roles of work, inequality, and social pressures in determining what people buy and when. In her view, marketers have less to do with what we want than, say, our neighbors, coworkers, or the people we follow on social media.

Our conversation, edited for length and clarity, is below.

When I think of the beginning of what I perceive as modern American consumerism, I tend to go back to the 1950s and post-World War II, people moving to the suburbs in the cookie-cutter homes. But is that the right place to start?

Scholars differ on how to date consumerism. I would say we need to go back a bit earlier to the 1920s, which is when you get the development of mass production, which is what makes mass consumption possible. This perspective differentiates the 20th century from the earlier period, in which you have shopping and you have consumer fads. But what changes beginning in the 1920s is that the production technologies make it possible to produce things cheaply enough that eventually you can get a majority of the population consuming them.

In addition to the things that are happening in factories, the automobile is the leading industry where you move from stationary production to a moving assembly line and big declines in costs. You also have the beginnings of the modern advertising industry and the beginnings of consumer credit.

Then it stalls out, of course, because of the Depression and the war. What happens in the 1950s is the model gets picked up again, this time with major participation by the federal government to spur housing, road building, the auto industry, education, and income. We get into durable goods and household appliances. As we know, that’s really confined to white people post-war.

I imagine it’s changed across the decades, but why do we buy things, often more than we need?

Scholars have different answers to this question. Economists just assume that goods and services provide well-being, and people want to maximize their well-being. Psychologists root it in universal dimensions of human nature, which some of them tie back to evolutionary dynamics. I don’t think either of those are particularly convincing.

The key impetus for contemporary consumer society has been the growth of inequality, the existence of unequal social structures, and the role that consumption came to play in establishing people’s position in that unequal hierarchy. For many people, it’s about consuming to their social position, and trying to keep up with their social position.

It’s not necessarily experienced by people in that way — it’s experienced more as identity or natural desire. But I think our social and cultural context naturalizes that desire for us.

If you think about the particular things people want, it mostly has to do with being the kind of person that they think they are because there’s a consumption style connected with that. The role of what are called reference groups — the people we compare ourselves to, the people we identify with — is really key in that. It’s why, for example, I’ve found that people who have reference groups that are wealthier than they are tend to save less and spend more, and people who keep more modest reference groups, even as they gain in income and wealth, tend to save more.

Increases in inequality trigger what I’ve called “competitive consumption,” [the idea that we spend because we’re comparing ourselves with our peers and what they’re spending]. It can be hard to keep up, particularly if standards are escalating rapidly, as we’ve seen.

Shoppers in a mall carrying large Disney store bags.
Value in American society is connected to what we can buy.
 Mark Boster/Los Angeles Times/Getty Images

I want to dig into this idea of competitive consumption. How are we competing with each other to consume?

We have a society which is structured so that social esteem or value is connected to what we can consume. And so the inability to consume affects the kind of social value that we have. Money displayed in terms of consumer goods just becomes a measure of worth, and that’s really important to people.

How do we pick our “reference groups” if it’s not necessarily by wealth?

We don’t know too much about it. The argument that I made in [my book] The Overspent American was that in the postwar period, we had residentially-based reference groups. So it was really your neighborhood. People moved to the suburbs, and they interacted with people in the suburbs. Those were reference groups of people of similar economic standing because housing is the biggest thing that people buy, and houses tend to cost the same amount roughly within a neighborhood. Family and friends and social networks have always been really important.

Then the next big thing that happens is that you get more and more married women going into the workforce. That really changes reference groups, because they go from a flat social structure in the suburbs to a hierarchy in the workplace, particularly if you’re talking about better-remunerated work and white-collar work. People interact with people above and below them in the hierarchy. So people were exposed to the lifestyles of the people above them in the informal socialization that goes on in the workplace.

Then there is the impact of media, and increasingly now, social media. It’s the friends that you don’t actually know, the Friends on TV.

The reference groups change under different socioeconomic dynamics, but it mostly has to do with who you’re in contact with — what you’re seeing in front of you, so your neighbors, your coworkers, what you’re seeing on TV, in movies, on social media.

I think the key point here that differentiates this approach from that of many people who think about consumption is that it is not saying that it’s primarily driven by advertising. It’s not a process of creating desire where it didn’t exist. Critics of advertising say it’s just making people want stuff they don’t need and doesn’t have value to them. And you have to think, “Okay, why do they keep doing that? Why do they keep falling for the advertisements?” Many of the things that people desperately want are not particularly advertised. My approach is rooted in really deep social logic.

It can be very rational and compelling for people to do something that in the end doesn’t necessarily make them all that better off but that failing to do requires really a major effort and going against the social grain in a very big way.

People aren’t buying a house because they saw a commercial for it.

Exactly. It’s because their sibling got one and their best friend got one. Everybody they know is getting a house, and then they think, “Okay, am I just going to be a renter?”

How has the role of women evolved in consumerism? Women are often driving what to buy, right?

Men still dominate in certain kinds of purchases, and particularly the big ones. Women were responsible for everyday purchasing: food and apparel and things like that. There’s that old binary that “men produce, women consume,” which comes out of the differences in roles we have in our economy to a certain extent.

It’s fascinating, though, because I did some work trying to estimate models of differences between men and women and various kinds of consumption, and I never found any gender differences. But if you are looking at data from marketers, you see a disproportionate amount of spending done by women.

What about Black Americans? You alluded to this earlier, but they were at least left out of the ’50s version of consumerism.

The literature on Black Americans’ consumption is not large. If you look at it as a whole, you get a couple of things.

The biggest takeaway is that Black consumers are not that different from white consumers. Now, they do spend on different things, but it’s not like there are two types of consumers, whites and Blacks, and they have different orientations and dynamics. You have differences that are occasioned by some of the dynamics of structural racism — for example, the lower rates of Black homeownership. You’ve got some particular things that you see in part due to the high urban population. Urban dwellers spend more on shoes because they walk a lot more.

You have dynamics among Black consumers that are driven in part by racism. So, for example, sartorial choices in which middle-class and upper-middle-class Black people will have to spend more on their wardrobes in order to avoid being stigmatized in retail settings, the so-called “shopping while Black phenomenon.” Cassi Pittman Claytor, a sociologist at Case Reserve Western University, wrote a wonderful dissertation [now a book] on middle-class and upper-class Black people in New York City, and one chapter is on the shopping while Black question. Some of the consumption choices are driven by the attempts to manage racism and stigma in the workplace and outside of it.

Another important phenomenon around the racial discourse in consumption goes back to the period of enslavement of Black Americans in which consumption was a prohibited activity. You see the linkages from the period of enslavement where you’ve got white moralistic discourses against consumption [by] African Americans. A lot of this is in the context of poverty and poor Black people, and the illegitimacy of their consumption choices. And that’s still present today. It’s a really pernicious line of discourse back to enslavement and the ways in which whites attempted to control consumption [by] enslaved people.

What about anti-consumerism? How has that evolved, the people who try to reject consumerism?

There’s a long history of consumer rejectors. You have it in the 19th century as well, and often these were religious groups or sects of people who went into intentional communities, like the Shakers.

To me what’s interesting about anti-consumerist movements of the current period is that there’s a certain kind of mainstreaming going on of them. They’re growing. My work is focused on the connections between work choices and consumer choices. So with downshifters, these are people who made decisions to work less and consume less, and it was often the decisions around work that were driving them. Many of them were not people who wanted to consume less in and of itself, but they wanted to take control of their time. And they were willing to make that trade-off.

You do have this minimalist movement now where the stuff is first, though it has a whole story around not getting tied to a burnout job. It’s connected with financial independence and this big “FIRE” movement — financial independence, retire early — and that’s really mainstream. It has much less of a countercultural aspect of it.

You’ve got people coming from the ecological side of things, like buy-nothing groups, and some of these are really big now. They have an ethic of anti-consumerism.

What we’re not sure about is how much participating in one of these actually reduces people’s consumption of new items. But people who participate in buy-nothing groups, most of them don’t buy nothing.

Has the conversation around consumerism and the environment picked up? Should we be talking about consumerism more in the context of saving the planet?

I think we should, and there are two parts to it. One is consuming differently, and the other is not consuming as much. So, volume and composition. To meet climate targets, we need to do both.

There are also issues of inequality of consumption. Look at the inequalities of income and wealth, which have led to these really gross disparities — the excess consumption of people at the top and the deprivation of huge numbers of people both domestically and abroad. It’s not just the bottom, it’s a big swath of the population that doesn’t have enough. So the distribution of consumption is really key, and a lot of the discourse around climate ignored that for a long time. The Green New Deal really put it at the center — it doesn’t lead with a critique of consumerism by any means, but it’s about meeting people’s needs and equity. It has a lot of implications about how we live.

The climate situation does compel us to look differently. In Plenitude: The New Economics of True Wealth, a book I wrote which is now 10 years old, one of the things I looked at was the volume of consumption of consumer goods over the decade before the crash [ahead of the Great Recession]. There was a massive speedup in what I call the cycle of acquisition and discard, just the volume of things people were buying. The fast fashion model that we saw in apparel happened in all sorts of other items, too.

The crash led to a hangover in which you haven’t seen that acceleration again, but it was just a period that showed how dysfunctional the consumer system has become.

Did the Great Recession change how we’re behaving and what we’re buying?

It really slowed down that cycle of acquisition and discard. From 1991 to 2007, the number of pieces of apparel people were buying, on average, went from 34 pieces of new apparel a year to 67. That number hasn’t really budged in the last 10 years.

We haven’t had a massive discontinuity in how the consumption system is operating, but people had less money. And that’s part of the rejecter dynamic — when it’s more difficult for people to participate in that system, either because of its growing cost or their own incomes stagnating, they are likelier to reject it.

It will be interesting to see whether there are any wider impacts of Covid and the fact that people lived with not much more than basic necessities for a while. My own view is that the work patterns are really key in driving consumption. The standard economic view is that it’s the consumer decisions and desires that drive work patterns, and I don’t think that’s the way it works. I think that work patterns actually end up driving consumption.

Shoppers wait in line to enter a Costco Wholesale store on March 14, 2020 in Glendale, California. 
Mario Tama/Getty Images

People make decisions about work, and the hours of work and the incomes associated with them are fixed with the decision. In general, if I decide to take my job as a professor, it has a salary that goes with it, and then that’s what drives my consumption decisions because it drives my income.

If I can’t work this hard anymore, I’m going to go part-time and my income gets cut in half, then I have to adjust my consumption. And that’s not to say it doesn’t go in the other direction — if I want to buy a house, I am going to work some more. But this is my analysis of how the work and spending sides fit together, which is that the work side is a little more dominant.

So we are entering a moment where lots of people have been sitting at home for a year and a half, and as you said, there’s a lot of pent-up demand. Plenty of people I know are ready to spend. Is it odd that we’re responding to the end of a crisis by spending money?

We’re just talking about the people who have it. One of the things about the pandemic is that it made the inequalities in income and spending power more visible to many Americans.

You had so many people who just were struggling through the pandemic to meet basic needs. If you think of that as a working-class phenomenon, you also had this middle-class phenomenon of people whose salaries continued. They were stuck in their houses, so the money was coming into their bank accounts every month and they didn’t have much to spend it on at all. There are people with considerable disposable income right now. We’re going to see a burst of spending now, and we’ll see how long it lasts.


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