Abstract
The ecological unsustainability of current consumption patterns is now well documented. One aspect of this problem which has not been sufficiently addressed is the growth of “excess consumption” driven by falling goods prices. The index of department store prices have fallen substantially since the early 1990s, in large part because global capital mobility and excess global labor supply has allowed firms to depress wages and avoid paying environmental costs. Consumers have responded by purchasing increasing numbers of these artificially cheap goods. The example of apparel is discussed in some detail, and data from other goods categories are presented. These trends suggest that achieving sustainable consumption in the US is not only a technical issue but will also involve fundamental changes in the global political economy to eliminate the artificially low prices of imported goods. © 2005 Elsevier B.V. All rights reserved.
Generated Summary
This commentary in the journal *Ecological Economics* by Juliet B. Schor examines the ecological unsustainability of current consumption patterns, focusing on the role of artificially low prices in driving “excess consumption” in the global economy. The study adopts a political economy approach, arguing that technological solutions alone are insufficient to achieve sustainable consumption. The author explores how the structure of global power, particularly the dominance of the United States, has artificially reduced prices for consumers in industrialized countries, leading to increased consumption. The analysis employs a case study approach, focusing on the apparel industry, and considers the impacts of global economic structures, particularly the “global sweatshop” and “cheap banana” phenomena, on consumption patterns and environmental degradation. The study also delves into the dynamics of falling prices and rising quantities of manufactured goods and primary commodities, highlighting the environmental consequences of these trends. The author advocates for structural changes in the global economy to promote sustainable consumption.
Key Findings & Statistics
- Between 1993 and 2004, real personal consumption expenditures per capita rose from $19,593 to $25,973 (2000 dollars), or 33%.
- The department store price index declined from 542.9 in February 1993 to 494.3 in February 2005.
- Durable goods prices declined from 457.6 to 381.0 over the same period.
- In 2001, US expenditures on toys totaled $29.4 billion a year, with 80% imported and 71% from China.
- The average production wage in Chinese toy factories is 14-19 cents/h, and the wage range is from 7 to 33 cents.
- The CPI for toys went from 122.4 in 1993 to 126.7 in 1997, and subsequently fell to 79.6 in 2005.
- The total volume of toy units consumed in 2001 was 3.6 billion.
- The number of purchased sheets and pillowcases rose 29% between 1996 and 2002.
- Towels increased 22% between 1996 and 2002.
- In 2003, 1.2 billion pairs of shoes were imported, or just over four new pairs per person per year.
- Appliance prices have declined, from 100 in 1997 to 86.6 in February 2005.
- The number of vehicles purchased increased, as dollar expenditures on new vehicles increased considerably, from $1216/year in 1993 to $2052 in 2003.
- The price index for sporting goods has fallen from 119.7 in February 1993 to 114.37 in February 2005.
- Jewelry and watches have declined from 146.2 in February 1993 to 127.1 in February 2005.
- Overall, the CPI index of durables has fallen from 119.8 (February 1993) to 115.8 (February 2005).
- In 2002, the average American ate 26.8 lb of bananas a year.
- Between 1990 and 2002, per capita consumption of bananas went from 24.3 to 26.8 lb/year.
- Per capita consumption of cocoa rose in the second half of the 1990s, but has subsequently declined.
- The UN index of non-fuel commodity prices declined 45% in the 1980s.
- In 1996, the United States imported 7.38 billion units of apparel; in 2002, imports totaled 13.51 billion units, a rise of 83%.
- The 2002 import level translates to approximately 48.3 new pieces of imported apparel purchased per year, per person
Other Important Findings
- The ecological unsustainability of current consumption patterns is now well documented, yet the growth of “excess consumption” driven by falling goods prices has not been sufficiently addressed.
- The author suggests that achieving sustainable consumption in the US requires fundamental changes in the global political economy to eliminate artificially low prices of imported goods.
- The decline in department store prices since the early 1990s is linked to global capital mobility and excess global labor supply.
- The example of apparel is discussed in some detail, highlighting how falling prices of apparel have led to an increase in consumption, and a shift to offshore production with low wages and poor labor conditions.
- The author introduces the concept of “excess consumption” which refers to additional consumption triggered by declines in the prices of goods and commodities due to the organization of the global political economy.
- The “global sweatshop” and the “cheap banana” are used as metaphors to describe the dynamics of low cost production and falling prices.
- The case of apparel demonstrates how the decline in apparel prices is associated with a rapid cycle of acquisition and discard.
- Falling prices in the US are linked to the projection of US power abroad that enables the exploitation of labor and resources.
- The article identifies that the structure of global power has artificially reduced prices for consumers in industrialized countries and therefore increasing consumption demand.
- The need for a shift to higher foreign wages, more internalization of ecological costs, and more equitable distribution of wealth is advocated.
Limitations Noted in the Document
- The paper acknowledges that the measurement of “excess consumption” and its precise environmental impact is beyond its scope, making it a hypothetical exercise.
- The paper focuses on the US context, and the conclusions may not be directly applicable to other countries or regions with different economic structures and consumer behaviors.
- The article’s primary focus on unit consumption rather than a product-specific environmental impact measurement.
- The reliance on data from specific industries and sectors.
- The study’s argument that a purely technological approach to sustainability will fail because the incentives to increase the scale of consumption are too powerful.
Conclusion
The analysis underscores the need to address the root causes of unsustainable consumption, specifically the artificially low prices of imported goods and the exploitation of labor and resources. The author emphasizes that achieving sustainability requires more than just technological solutions, and it necessitates fundamental changes in the global political economy. “These trends suggest that achieving sustainable consumption in the US is not only a technical issue but will also involve fundamental changes in the global political economy to eliminate the artificially low prices of imported goods.” The commentary argues that the current system, characterized by the “global sweatshop” and the “cheap banana,” perpetuates unsustainable practices. The author highlights the role of US imperial power in shaping these dynamics. The analysis suggests that environmentalists should consider the impact of cheap labor and resources and address the corporation’s quest for them. The current structure of global power, and especially the dominant role of the United States, has artificially reduced prices for consumers in industrialized countries. In this regard, the commentary concludes by saying “My perspective suggests the need to re-structure the rules of the global economy to prevent exploitation of labor and resources, which should have the effect of raising the prices of imports both relative to other goods, and also in real terms.”