There can seem to be no better way to measure economic successes of an individual by their ability to financially afford their desired commodities. If you make enough money in which to afford luxury items after all other basic needs such as food, shelter, utilities, etc. are met and paid for, then why not buy luxury items that can be attained within your financial means? In fact, some luxury items are perceived as needed by individuals. Take for instance the growing rate of cell phones. Cell phones can be seen as a need in a society that has made public pay phones less accessible to its citizens. If an individual is out and about and an emergency arises in which they need to assess family or other significant persons immediately, cell phones are of a great benefit as they satisfy the need of instant communication while away from home. Thus, the purchase of a cell phone can be perceived as a necessity for use in everyday life. The same can be said for automobiles. Not everyone can live within walking or commuting distance of every institution in which they need to regularly assess. And in many cases, reliable commuting options are not available to many people who may even wish to use them. A person with the financial means will most likely want to purchase such a luxury item as an automobile to allow for transportation to and from their necessary destinations such as work, grocery shopping, their children’s pick up and drop off, etc. Why should anyone have to sacrifice and go without an automobile for these reasons if they can afford it?
The fact that there are external factors that motivate a person’s decision-making process when contemplating new purchases exacerbates the reasons behind their choices. Many decisions are heavily influenced by community norms and aggressive marketing by businesses. Since humans tend to use a reference point for assessing what we need or want, we have the tendency to be heavily influenced by what we know is further available to us. For instance, humans use their reference groups to measure their own situations. If people similar to them have items that they do not have such as a large acre home, they are apt to believe that they do will need a similar or bigger-sized house in which to feel adequate. This may be so even if the number of people within a person’s household is not sufficient to fill the home. Thus, in knowing what is wanted rather than needed is convoluted by the influences we encounter. Marketers play on this fact by offering multiple products in which to choose from. Thus, their aggressive marketing tactics can influence a consumer’s decision-making process when it comes to purchasing choices. This is especially significant since consumers get most of the information they need for purchasing an item from advertising. As Barry Schwartz stated in Deciding and Choosing, “The average American sees three thousand ads a day”… “So we don’t have to do our choosing alone and unaided (p. 53).”
With the influx of options presented to consumers by marketers who seem to have the sole purpose of selling their product by any means necessary (not taking into account if the person can either comfortably afford or even needs a product), how can happiness or satisfaction of obtaining a new purchase be measured totally on a person’s willingness to purchase it? People get bored with things after adaptation. Humans tend to assess the ‘changes’ in perceived satisfaction than to the ‘absolute level’ of satisfaction we experience (Microeconomics 101). Once we become accustomed to something, our satisfaction of having it may wane. It thus, becomes ‘normal’ to us. We tend to get excited or feel pleasure at the prospect of having increased options to obtain more of the same thing or something else and we can be continually attracted by stimuli that promise us something more, new, or different. Marketing tactics play on this notion and use it to their advantage in selling their products. The information that their advertising generates can thus be used in helping people to erroneously make inefficient purchases that they probably could have done without.
Again, if a person is looking to purchase an automobile that is necessary for transportation to and from significant destinations that are a distance from their home, then an automobile purchase can be an efficient and necessary item in which to possess. However, with the influence of external factors like advertising and reference groups, a person can be duped into believing that they need a bigger, faster and a more energy consuming vehicle than would be efficient for their intended use. A person may think they need a bigger and better version of an item but can most likely get a more practical option that satisfies their basic needs for less. There are many consequences that come with this kind of influential purchasing but I will only focus on two. For one, it is no secret that automobiles present a risk to the environment with each emission that they let off so pollution becomes a bigger problem with bigger purchases. The bigger an automobile is, the more gas it may need and thus, the more emissions it lets off. While having a bigger and better car (as determined by marketing tactics) may bring about pleasure in knowing that you are on par with your reference group who also have bigger and better cars, it does not take into account the damage to others that is evident in the destruction that automobiles cause to the environment. The social-well being of others becomes jeopardized.
Secondly, an individual’s spending behavior can make purchasing more costly across all income levels. Robert Frank pointed out that an individual’s purchasing behavior creates incentives for others to either strive for the same or a bigger, better version of a product and that spending habits dictate the market for all. If luxury spending begins at the top of the income distribution, all income levels feel pressure to spend more when ‘community consumption standards’ rise. Evaluating your ‘wealth’ by the next group below you in measuring satisfaction or success (being satisfied by having something others do not), is exacerbated by the already apparent penchant humans have for “tuning into changes in our perceived satisfaction” that I referenced earlier. While it may not be financially affordable or efficient for people on the bottom rungs of the income distribution to compete in this kind of spending atmosphere, it becomes almost mandatory as the spending patterns from the people at the top of the income distribution “have been the leading edge of pervasive changes in the spending patterns of middle-and even low-income families (Frank, p. 3).” An individual’s consumerist values can thus, impede the well-being of society as a whole.
Works Cited: Frank, Robert (1999). Luxury Fever: Why Money Fails to Satisfy in an Era of Excess. The Free Press. NY
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