Ch. 2 The consumer movement
Intro
Demographic & Consumption Shifts
Consumerism and the consumer movement defined
Decades of Consumerism
1880-1900
Early 1900
1910S
1920s
1930s
John Maynard Keynes
Economist
President Franklin D. Roosevelt
John Kenneth Galbraith
Economist
1940s
1950s
1960s
President John F. Kennedy
1970s
1980s
1990s
The twenty-first century
Conclusion of the decades of consumerism
Key Terms
click to edit
cognition
common law
conspicuous consumption
consumer movement
cyber squatting
depression
desirable products and services
developmental environmentalism
hedonic value
hucksterism
law of comparative advantage
muckraker
offline shopping
online shopping
pollution
rational self-interest
cease-and-desist order
bricks and clicks
antitrust laws
people make choices that give them the greatest satisfaction at a particular time based on info they have.
when some one pays an extremely high price for it's prestige value, making a higher demand than simple price-demand.
example: someone buys $500 designer shoes vs the $59 store brand
extreme promotion
Historical Perspective
Upton Sinclair & President Theodore Roosevelt
A term for writers, politicians, journalists, and public speakers who search out and expose political or commercial corruption
laws used to prevent monopiles and are used to make and keep competition so consumers get fair prices and goods in adequate quantities
the unwritten system of law that is the foundation of both English and US legal systems
an administrative/ judicial order ordering a business to stop "unfair or deceptive acts or practices."
any undesirable change in biological, chemical, or physical characteristics of air, land, or water that harms activities, health, or survival of living organisms,
Environmentalism
concern for the environment
misleading individuals attempt to buy and control websites that look like legitimate commercial websites
products should not just be made for profit, but for the benefit of consumers and the society as a whole.
pleasant/pleasing benefits for consumers and society
a physical store and an on line store
shopping at a brick and mortar store
shopping on a website, or a middle man, like Amazon/ using a computer for shopping
the ways which people and systems grow and change
Individuals, firms, regions, or nations can gain by specializing in the production of goods that they can produce as cheaply as possible
a form of awareness, examines the way individuals and governments regulate themselves and their behaviors.
policies aimed at regulating products, services, methods, and standards of manufacture, selling, and advertising in the interests of the buyer.
a drastic and long-lasting decline in the economy, with high unemployment, falling prices, and decreasing business activity.
most countries have a consumer movement
most regilate on food, air lines/transportation, and drugs
if a legislation is passed in one contry it will often be adopted in another
as more and more international cooperation will be sought as the global market grows
Sherman Antittrust Act
prohibited monopolies and price-fixing and encouraged competition.
appoling work conditions
Native Americans were systematically moved against their will.
middle class grew
food fads and hucksterism
materialism and consumerism becoming more complex as inventors and businesses brought many new goods to the market
Suburban and small-town living began replacing rural living for the masses
Harvey Wiley
called the founder of the modern consumer movement
thought that consumers should have food products tested
took this quest to the US Department of Agriculture
In the 1880's he circulated his findings among other professionals
1890s, we urged consumers to campaign to get congress to initiate laws on food quality.
Pure Food and Drug Act of 1906
he first federal law in US history specifically enacted to protect consumers
the cost and purity of food were especially critical to the well-being of individuals and families.
Wiley set up a group called the “ Poison Squad.”
healthy young adults, ate unadulterated food and food with additives over 5 year period
found that preservatives readministered continuously in small doses negativly affected digestion, appetite, and gerneral health.
Some business groups said his work was antibusiness—even anti-American
Wiley became the symbol of food and drug reform.
dealt with the production, transportation, and sale of food and drugs in the United States.
Upton Sinclair
President Theodore Roosevelt
wrote The Jungle
known as a fighter for social causes
out raged by The Jungle
joined Congress in calling for federal legislation to correct the matter
known as a president who expanded the powers of the federal government on the side of public interest in conflicts between big business and big labor
In 1902, he established a Bureau of Corporations with powers to inspect the books of all businesses engaged in interstate commerce.
1914
The Clayton Act
The Federal Trade Commission (FTC) Act
restricted price discrimination, exclusive dealing, and tying contracts.
prohibited deceptive advertising and unfair and deceptive trade practices.
Christine Frederick published The New Housekeeping: Efficiency Studies in Home Management
1913
16th amendment was added for the collection of income tax
Interstate Commerce Act
Power to regulate commerce was reserved to the states.
Meat Inspection Act 1906
It provides for meat inspection
1912
the establishment of Better Business Bureaus
discouraged dishonest business practices
1915
middle class had electricity
"chain store" begins
breakfast from cereal boxes became common
1917
WW1 starts leading to a quite consumer period
With WW1 over many people relax and celebrate
consumer income rose and prices remained stable
1928
Your Money’s Worth by Stuart Chase and F. J. Schlink, exposed false advertising and high-pressure sales techniques
called for more testing and improved standards
1929
Consumer Research, Inc. was formed for testing work
October stock market crashed
depression begain worldwide
1933
lowest point in the depression
run on banks
people lost faith in American industry and in American banks.
no one knew how to handle it
published The General Theory of Employment, Interest, and Money (1936)
easily explained:
Economic activity in a capitalist system is determined by the willingness of its entrepreneurs to make capital investments
his solution was to increase government spending
influenced Franklin D. Roosevelt
founded a school of thought
Keynesian economics
emphasizes the role government plays in stabilizing the economy
the New Deal
used the federal government’s powers to bring about a national economic recovery,
president during World War II.
his policies were not the hands-off kind of government
crisis demanded a more hands-on approach,
signing the Fair Labor Standards Act in 1938, which established the 44-hour workweek
in 1941, this was reduced to the standard 40-hour workweek
1938, the Wheeler Lea Act was passed, providing the FTC more jurisdiction over misleading or false advertising
Food, Drug, and Cosmetics Act of 1938
by adding cosmetics and allowing inspectors to remove dangerous products from store shelves while tests were being completed.
The Affluent Society , published in 1958
less emphasis on production and more emphasis on public service
WW2
rations are heavily watched and controlled
“Use it up, wear it out, make do or do without”
victory gardens are grown to help send caned foods over seas
homes became more technologically advanced
Phones 36%, Friges 91%
Seventeen magazine was introduced earlier in 1944
Women entered the work force
1940s and 1950s advertising surged, and demand for consumer goods was never higher
Advertisers gained respect when they produced effective propaganda for the war effort.
grocery stores and shopping plazas replaced corner mom-and-pop stores;
Everyone wanted to buy what was new and to put the war behind them.
To consume was to be free
the mid- to late 1950s, loud was in—loud colors, loud television westerns, loud fashion, and loud music with rock “n” roll and Elvis Presley.
split-level house was introduced
Food preferences changed too
introduction of Mattel’s Barbie in 1959.
In 1959, the Food and Drug Administration (FDA) seized boxes of Pillsbury blueberry pancake mix for misbranding
Rachel Carson
the founder of the modern environmental movement. She was an American biologist who wrote Silent Spring, an exposé on pollution
advocated the use of natural pests or deterrents rather than chemicals
read Carson’s Silent Spring and decided to take action
gave the famous Consumer Bill of Rights:
The right to safety (to be protected from hazards to health and life).
The right to be heard (to be protected from fraud, deceit, or grossly misleading information including advertising and labeling).
The right to choose (to have access to a variety of products and services at competitive prices).
The right to information (to be assured of fair and expeditious treatment from government and in policy formation).
The right to a decent environment (influenced by several presidents).
The right to consumer education (added by President Gerald Ford).
The right to reasonable redress for physical damages suffered from using a product (added by President Richard Nixon).
age of dominance of large national general merchandise and department stores and spread of fast-food brands.
Ralph Nader
Published Unsafe at Any Speed 1965
highlighted the need for more automobile safety
spoke out against:
pollotion
abuse of corporate power
Paul Ehrlich
Wrote The Population Bomb 1968
sugested that there are too many people/ everything
if not dealt with famines an catastrophes would occur
Senator Warren G. Magnuson and Jean Carper
Published The Dark Side of the Marketplace 1968
explained how the consumer movement when from sales deceptions and safety standers to concerns over pollution and the trend towards economic concentration
their work inspired the 1973 FTC Door-to-Doors sales Rules Act
also influinced the 1970 Public Health Cigarette Smoking Act
consumer protection legislation in the 1970s led by Presidents Richard Nixon (Republican), Gerald Ford (Republican), and Jimmy Carter (Democrat)
Many of the 1970s acts, because they are landmark legislation, are still influential today
With the legislation, a consumer could cancel within a three-day cooling-off period.
high-pressure salespersons were rushing consumers into buying things they did not want
With President Ronald Reagan there was a renewed look at consumer protection in this country.
Agencies were reorganized
took the view that the market should regulate itself
college students flocked to business schools
video games came into style
Movies about greed and Wall Street abounded
Consumers were encouraged to use the laws already on the books
Anti cybersquatting Consumer Protection Act of 1999.
Clinton signed the NAFTA, which greatly impacted trade, employment in certain industries, and prices.
This was a decade of affluence, expansion, and low unemployment
A book entitled Affluenza and public television documentaries Affluenza and Escape from Affluenza recommended that people go hiking, spend time with their families, or volunteer rather than go to the mall
there was a nationwide switch to more recycling
the internet and computers changed the consumer experience
online shoping became a thing
stores started selling online and in stores
obama's years
George W. Bush
recession was reached in 2009.
The recession affected the types of jobs that college grads could readily get
many students had to get other jobs then what they wanted to pay for their diets
Affordable Care ACT
his attention was drawn to the war on terrorism, the war in Iraq, and related security issues.
were waves of mergers and turnovers in economic advisors
Mergers escalated for several reasons:
Antitrust legislation was less enforced.
Deregulation spread.
Large companies benefited from mergers.
A weakened economy made smaller companies more vulnerable and willing to sell.
2006 Consumer Telephone Records Act,
prohibited the sale of consumer cell phone records.
Privacy issues regarding the use and tracking of smartphones escalated.
The growth of the Internet as an information and selling source is a hallmark of the twenty-first century