Good Question: Are We Buying More Than We Used To?
MINNEAPOLIS (WCCO) – In the next couple of days, many of us will be crowded into stores to finish buying gifts for our loved ones.
All that spending got us thinking about our culture of consuming: Are we buying more than we used to?
Shopping is America’s national pastime. It happens all year round, not just on the holiday. So at Maplewood Mall on Thursday, it was no surprise to see a lot of buying going on.
Shoppers, when asked, seemed to think that Americans were indeed buying more.
“My daughter is 6,” one shopper said. “She wants an iPad.”
Jeanne Baeh, an economist who works at Augsburg College, said that, as a society, Americans are buying a lot more than they used to.
“It used to be that if you were poor, you didn’t have things like air conditioning, TVs and cell phones,” Baeh said. “And now even poor people have those things.”
Is there an economic reason why we are buying more?
According to Baeh, it’s because things are cheaper.
“The law of demand says as price goes down…you buy more of it” Baeh said. “And it costs us less in terms of work hours.”
Take cell phones: In 1984, for someone earning the average wage, it cost 456 hours to buy one.
Today, it’s closer to 4 hours.
The sticker price for the average mid-sized car has actually gone down over the past decade.
In 2006, the average family spent around $48,398. Last year, the average American family spent $49,705.
“A lot of that is not fun things, like iPhones,” Baeh said. “It’s groceries, it’s gasoline.”
But, in general, our money buys more. So don’t feel guilty.
“I think a lot of the things have made life better for many people,” Baeh said.
Consumer spending makes up about two-thirds of the economic activity in the U.S., so that consumer culture is important to the economy.