Consumerism vs Consumerism

Corporate overlord here. Today we are going to learn about consumerism. There are several concepts that have at times been called consumerism. The worst concept that goes by that name is really just a synonym for conspicuous consumption.

This is purchasing what everybody else has purchased, and more to show status. Unfortunately having material goods does not really indicate what an individual is worth. This is especially true if the latest gadgets are fancy, have all the bells and whistles, and will last about 3 weeks. That leads us to the good form of consumerism: being a good consumer. No being a good consumer is not about conspicuous consumption.

Being a good consumer is about following classical microeconomic models of utility maximization. (Which so few really do, the homo economicus is pretty much non existant.) In other words, it is your money, if you must by item X, what is the best item X you can get for it? This is a very simplified form of Utility maximization, but long form utility maximization is tedious, and makes too many assumptions that probably don't hold.

Now how does one get the best item X for their money? Well in short, do your homework. One thing I like is headphones. If I have the money for a new pair of headphones (and I don't) then there are several resources. I could check online with headphone enthusiasts, who have several websites. I could check with a publication like consumer reports (although that particular publication tends to be a mouthpiece for certain manufacturers.) I could even try several pairs of headphones on myself. (Yes I know a store that will let me do this.)

What a good consumer does not do is say "Oh I've heard of brand Y, they must be good." Companies rely on this sort of thinking to dupe customers. Several companies ride on reputation even as their quality falters. Some brands (A certain audio company) never even had quality, but rely on the fact that most consumers are terrible at playing the consumer game.

This brings me to another point: Often you get what you pay for up to a certain point. A number of companies with high brand recognition actually give you less than you pay for.
This isn't saying go with "budget brands" (Although everyone should spend no more than they can afford at the most.) This is saying some brands will rip you off if they have a name. Its your money. If you must spend it, get the most you can with it.




A note about this post: A few may accuse me of misrepresenting utility maximization. The important thing to note is that I DO understand utility maximization, but I have to paraphrase somewhat as this post is not written for economics students. (although they are welcome to read it)