Rethinking Consumption:

From Wealth to Well-being

Gary Gardner, Erik Assadourian, and
Radhika Sarin

State of the World 2004

 The Consumer Society
A society in which acquisition and
use of “goods and services is the
principal cultural aspiration and the
surest perceived route to personal
happiness, social status, and
national success.”

— Paul Ekins
 Three Points

• Consumption has the character of a

runaway train in much of the world
• Current consumption patterns have a
growing dark side for individuals,
societies, and the planet
• A different model of consumption is
available—one that can deliver a
higher quality of life
1. The State of Consumption Today
 Private Consumption
Expenditures, 2000
% of World
% of World Consumption
Selected Region Population Expenditures

U.S. & Canada 5% 32%

Western Europe 6% 29%

East Asia & Pacific 33% 21%

South Asia 22% 2%

Sub-Saharan Africa 11% 1%

 Distribution of Global
Consumer Class, 2002
% of World Total
Total: 53% 47%
16%
27% World total =
(other regions) 1.7 billion
20% consumers
8%
Million Consumers

1000 29% 912

816

494
500
349
271
141

0
U.S. & Western East Asia South Asia Industrial Developing
Canada Europe & Pacific Countries Countries
 Global Consumer Class
Selected nations, 2002

243 Million (84% of population)

United States
240 M (19%)
China
122 M (12%)
India
121 M (95%)
Japan
76 M (92%)
Germany
61 M (43%)
Russian Federation
58 M (33%) Consumer class
Brazil

Millions of People
 Car Growth in China
200
1
50(e
150 st.)
Millions of Cars

100

50
10 14
5
~ 0
0
1980 2000 2002 2003 2015
Year
What drives the appetite for
consumption?
Physiological Drives
- Survival instinct: natural impulse
to alleviate discomfort (hunger,
cold, etc.)

Social and Psychological Needs

- Means of expressing social identity
- Seeking comfort, style, and status

Large Supply of Goods

- Increase in production efficiency =
greater availability of goods
What drives the appetite for
consumption?
Globalization
- Reduction of tariffs and cheap
labor = lower costs, more
affordable products
Technological Innovations
- Greater capacity to extract raw
materials and resources at lower
cost (i.e., fishing trawlers)

Cheap Energy and Transportation

- Increased distribution and expanded
markets
 Business Practices to
Stimulate Consumer Demand
Advertising
- Pervasive in commercial broadcasting,
print media, Internet
- Product placement in movies, TV programs
Global and U.S. Advertising Expenditures, 1950-2002
500
World
400
Billion Dollars
(2001 dollars)

300
200
100
United States
0
1950 1960 1970 1980 1990 2000
Source: McCann-Erickson
 Business Practices to
Stimulate Consumer Demand
Credit Cards
- Consumers can purchase goods
beyond their means

Government Policies
- Economic subsidies affect
consumption patterns
- Ex.: subsidies for suburban
homebuilding lead to demand for
household goods, cars, roads,
etc.
2. The Dark Side of Consumption
 The Dark Side of Consumption
• Huge amount of consumer
waste
– Unlimited consumption at odds
with patterns in natural world
– In nature, no worthless waste,
all matter reused or recycled

• Natural areas under

stress
- All the world’s ecosystems
are shrinking to make way
for human development
 Global Living Planet Index

Tool developed by World

Wildlife Fund (WWF)
International to measure
health of natural systems

(e.g., forests, oceans,

freshwater systems, etc.)
 Economic Activity and
Ecosystem Health, 1970-2000

3.0
Gross World
Product Index
(1970 = 1.0)

2.0

1.0
Global Living
Planet Index
0.0
1970 1980 1990 2000
Source: Maddison, IMF, UNEP, WWF, RP
 The Personal Toll
HEALTH

65 % of American adults are

overweight or obese

DEBT
61% of Americans with credit
cards carry a balance, averaging
$12,000

TIME
Americans work the equivalent of
9 weeks more each year than
Europeans
 Wealth vs. Well-being

Once basic needs are met, affluence

and the accumulation of goods do
not necessarily correlate with a
higher quality of life
 Average Income and Happiness
in the United States, 1957-2002

25,000 100

Percent of People
20,000 Average 80

"Very Happy"
Average Income

Income
(1995 dollars)

15,000 60

10,000 40

5,000 Very Happy 20

People
0 0
1957 1967 1977 1987 1997
Source: Myers
3. A New Model is Possible
 Aspects of Well-being
Basic Needs Food, shelter, secure livelihood

Good Health Physical and mental health and

a robust natural environment
Healthy Social
A supportive social network
Relations

Security Personal safety and security of

one’s possessions

Freedom The capacity to achieve one’s

development potential
 Well-being Index

• Tool developed by Robert Prescott-Allen

to measure societal health

• Uses 87 different indicators to measure

human and ecological well-being
– e.g., Life expectancy, school enrollment
rate, extent of deforestation, level of carbon
dioxide emission, etc.

• Values for indicators are standardized

and summed into a single score
 Well-being (WB) Ranking
(selected countries)
Human WB Enviro WB Total WB
Maximum
Score 100
79
80 71
64
60 49 49

40 27 31 27
23
20

0
Sweden Benin Saudi Arabia
(Rank out of (1st) (47th) (176th)
180 countries)
 Rethinking Progress
Human WB Enviro WB Total WB
Maximum
Score 100
79 78
Similar Human80WB, 73
but different 64
Enviro WB:60 52
49 50
How a nation
40
meets its 31
development goals 22
as important20as
whether it meets
them 0
Sweden Netherlands United States
(Rank out of (1st) (24th) (27th)
180 countries)
 Toward an Infrastructure
of Well-being

Physical e.g., urban planning, mass

Infrastructure transit

Political e.g., subsidies, taxes, laws on

Infrastructure working hours

Cultural e.g., harnessing advertising,

Infrastructure improving education
 Getting to the Good Life

Current economic goal of unlimited

consumption is unsustainable
New emphasis for economy:
 to create societies with a higher
quality of life
 to live in harmony with natural
environment
 to facilitate healthy choices
 to tend to the basic needs of all
 About the Authors

Erik Assadourian is a Staff Researcher

at the Worldwatch Institute

Gary Gardner is the Institute’s

Director of Research

Radhika Sarin was formerly a Staff

Researcher at the Institute
 More information on
State of the World 2004
at www.worldwatch.org