Fashion: the Consumer as Status Symbol

Another excerpt from the book, The Fourth Economy: Inventing Western Civilization from 1300 to 2050. This is from the chapter on the information economy.

“Man is a social being. We can never explain demand by looking only at the physical properties of goods. Man needs goods for communicating with others and for making sense of what is going on around him. The two needs are but one, for communication can only be formed in a system of meanings. His overriding objective as a consumer, put at its most general, is a concern for information about the changing cultural scene.”

Mary Douglas[1]

Fashion – Could Any Social Invention More Obviously Be a Social Invention?

The purpose of fashion is to stimulate demand. It’s a pretty brilliant ploy, really, to compel people who have a perfectly good product to replace it.

The new production methods worked very well for making clothes. In the decades after Crowell’s success with continuous production, the textile and garment industry grew about two or three times as rapidly as any industry. By 1915, only steel and oil were larger industries than the clothing trade[2].

“’The way out of overproduction.’ Wrote one fashion expert, ‘must lie in finding out what the woman at the counter is going to want; make it; then promptly drop it and go on to something else to which fickle fashion is turning her attention.’” Constant change was essential to prosperity of manufacturers and retailers.[3]

The information economy was rich in symbols used for communication and computing. The genius of fashion is that it made the consumer’s goods a symbol, one they would pay dearly to enhance and maintain. In an age that was - at least politically - increasingly democratic, fashion was an important symbol of status, signaling rank. Fashion became fashionable just as aristocracies faded. Fashion made the consumer a symbol. 

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[1] James R. Beniger, The Control Revolution: Technological and Economic Origins of the Information Society (Cambridge, MA: Harvard University Press, 1986) 101.

[2] William Leach, Land of Desire: Merchants, Power, and the Rise of a New American Culture (New York: Vintage Books, 1994) 93.

[3] William Leach, Land of Desire: Merchants, Power, and the Rise of a New American Culture (New York: Vintage Books, 1994) 94.

Economic Goods to Do - a new definition of progress

The traditional definition of economic goods is a definition of stuff - cars, loaves of bread, clothes, and gadgets for which people will pay. Goods to have. A more comprehensive definition of goods will include goods to do - work so gratifying to people that they will give up pay to do it. People taking a job that pays $10,000 or $100,000 less than they might otherwise make are choosing goods to do over goods to have. Such a choice might signal progress.

Studies have indicated that once per capita income hits about $20,000 a year, more money does little to increase happiness. (This is not completely true. If you make more money than other people, you feel happier. This has to do with status rather than the happiness you get from being able to afford more stuff.) After about $20,000, income goes up but happiness stays about the same. This suggests that the economic assumptions of the last century might not hold in the 21st century.

L. Frank Baum is well known for creating the Wizard of Oz. He is less known for pioneering window displays in department stores. Shopping as entertainment is a relatively new phenomenon - it has only emerged in the last 100 to 150 years. In the late 1800s, department stores hired gawkers to stand on the sidewalk outside of stores, staring into the display windows. These gawkers helped to change social norms that frowned on looking into windows as evidence of bad manners. The idea was to entice window shoppers into the store, luring them into a strange and wondrous new world, like Dorothy drawn to see the Wizard of Oz.

Shortly after the Civil War, manufacturers had figured out how to make lots of product. In the late 1800s, the new puzzle was how to sell lots of product. To do that, retailers used display windows, advertising on radio and TV, distribution channels, interstate highways, catalogs, and department stores. During the last century, companies have focused on managing our attention as consumers - using advertisements to get us to buy. The result is an increase in GDP and satisfaction. But that path to progress seems to offer less promise in this century than the last. Ice cream makes you happier, but not if you’ve already had three scoops. We already have lots of stuff. Getting more stuff early in this century is unlikely to make us as excited as it did early in the last century.

Economic progress can no longer exclusively focus on economic goods to have. Philosophers argue for the importance of three kinds of goods: goods to have, goods to do, and goods to be. To date, economic goods have generally been assumed to mean economic goods to have.

Studies of happiness indicate that goods to have make less difference than goods to do. Engagement in activity - what psychologists call flow - does more to increase happiness than getting more stuff. This suggests that economic progress will increasingly require us to pay increasing attention to economic goods to do. Companies will need to focus on our attention as producers, at how engaged we are in our work, in order to make as much progress in this century as they have in the last. It is not so much “do what you love and the money will follow.” Rather, it is more like, “Once you have a certain amount of money, no things will bring you as much joy as doing what you love.”

Economic progress has meant more economic goods to have for a century. For the sake of our happiness and our planet, it is time to begin shifting the emphasis to economic goods to do. It isn't stuff we need - it is engagement. Making this shift to a new kind of economic good will require a significant change in how work is defined. It will also lead to great progress.