The Paradox of Affluence

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The Paradox of Affluence
Juliet Schor, Boston College
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RISING AFFLUENCEPersonal Consumption
Expenditures per capita (2000)
Source Council of Economic Advisers, 2007 Annual
Report Table B-31.
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Does consumption happiness?
The culture says YES, but the data shows a
different, more complex story
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What really makes us happy?
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Income and Happinessthe paradox in a nutshell
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National findings

• US. very happiness decades ago. Income
  (roughly) tripled since then.
• Japan. A five-fold rise in income led to no
  increase in happiness.
• Happiness in Indonesia, Mexico, Nigeria, Finland,
  Italy and the US is quite similar

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Three explanations for the paradox of
affluence(Schor 1998, 1992, 2009)

• Gains from spending are relative
• The work and spend cycle
• Affluence is causing planetary eco-cide

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Which would you prefer?

• 50,000 annual income, with your countrys
  average at 25,000 OR
• 100,000 annual income, with your countrys
  average at 250,000
• Most Harvard students prefer the first.

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Why? Because consumption is social
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Relativity in Consumption
How you feel about your house depends a lot on
who you live next door to
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Consumption reference groups

• A reference group is a set of people we compare
  ourselves to, and use to set norms of
  consumption, income and other things.References
  can be family, neighbors, friends, co-workers,
  friends on tv.

Not necessarily like sheep, but in a social way
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The new consumerism

• From keeping up with the Joneses, to keeping up
  with the Gateses.

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Changes in income distribution, 1947-2005
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The rich are getting MUCH richer
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The growth in luxury, status consumption
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The cycle of work and spend

• Rising hours of work
• Stress and time pressure
• Spending more
• But more in debt.
• Life on the treadmill

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The Output BiasRising annual hours of work,
CPS, 1967-2004
Source Economic Policy Institute, State of
Working America, 2006-07 Table 3.1
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Declining social connection
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When Prices Are Too Low how the economy of cheap
is undermining the planet
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Cheap labor and no environmental accounting a
Chinese sweatshop
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Apparel AccumulationAnnual purchases of
garments per capita, 1991-2004
Source Schor, The Social Death of Things,
unpublished ms. 2008
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Apparel DiscardUsed apparel exports from US to
Rest of World, 1991-2004
Source Schor, Social Death, 2008.
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Excessive consumption is putting the planet, and
its human, animal, and plant species in peril
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The ecological footprint

• The Ecological Footprint is the land and shallow
  sea water necessary to support a nations
  standard of living

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The world ecological footprint in 1961
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The world ecological footprint in 2001
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Impacts of global climate change

• BAU (business as usual) commits us to 3-10º C of
  heating, a catastrophic level. (5º is equivalent
  to the difference between the present and the
  last Ice Age). Uncharted territory. Positive
  feedbacks (ice sheet melting, permafrost melting,
  etc). Climate collapse.
• Water droughts, floods, sea level rise of many
  meters. 1 billion Asians suffering water
  shortages
• Species Loss 20-50 loss with 3º
• Declining crop yields hundreds of millions
  affected, explosive refugee problems.

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IPAT
Impact Population x Affluence X Technology

• Affluence per capita consumption
• Technology environmental impact per unit of
  consumption
• Affluence (a solution) creates ecological
  degradation which in turn reduces human
  well-being and undermines our conditions of
  reproduction (a problem).
• Affluence is the most difficult of the three
  factors to address but is imperative to deal
  with, because it is driving the climate crisis
  and ecological degradation.

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Per Capita Footprints
India
Senegal
Brazil
Japan
U.S.
Indonesia
Italy
China
Germany
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Solving the paradox of affluence and saving the
planet

• Downshifting and the slower life
• Conscious consuming
• Activist citizenry

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The new, green technologies closed loop systems,
eco-effectiveness and bio-mimicry.
But technology is just a start
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Living differently
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Income versus Free Time
Source Income versus Free Time Poll, Center
for the New American Dream, July 2004
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Source Readiness for Actions to Reduce
Consumption and Materialism Poll, Center for the
New American Dream, July 2004
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Source Agree Statements Attitudes About Role
in the Environment Poll, Center for the New
American Dream, July 2004
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Getting to Sustainability

• Fairness and social justice, design and
  technology, new consumer patterns and a
  consumers movement, new patterns of time use,
  and fun