What is a Consumer?

A consumer is defined as “someone who acquires goods or services for direct use or
ownership rather than for resale or use in production and manufacturing. ” Before the
mid-twentieth century, consumers were without rights with regard to their interaction
with products and producers. Consumers had little ground on which to defend
themselves against faulty or defective products, or against misleading or deceptive
advertising methods. By the 1950s, a movement called “consumerism” began pushing
for increased rights and legal protection against malicious business practices. By the
end of the decade, legal product liability had been established in which an aggrieved
party need only prove injury by use of a product, rather than bearing the burden of proof
of corporate negligence.

Consumer Bill of Rights

In 1962, President John F. Kennedy presented a speech to the United States Congress
in which he extolled four basic consumer rights — later called, The Consumer Bill of
Rights. In 1985, these rights were expanded to eight by the United Nations. These eight
rights are the:
John F. Kennedy: President John F. Kennedy extolled four basic consumer rights, later called the “Consumer
Bill of Rights. “

Right to Safety
The assertion of this right is aimed at the defense of consumers against injuries caused
by products other than automobile vehicles, and implies that products should cause no
harm to their users if such use is executed as prescribed. The Consumer Product
Safety Commission (CPSC) has jurisdiction over thousands of commercial products,
and powers that allow it to establish performance standards, require product testing and
warning labels, demand immediate notification of defective products, and, when
necessary, force product recall.

Right to Be Informed

This right states that businesses should always provide consumers with enough
appropriate information to make intelligent and informed product choices. Product
information provided by a business should always be complete and truthful. This right
aims to achieve protection against misleading information in the areas of financing,
advertising, labeling, and packaging.

Right to Choose

The right to free choice among product offerings states that consumers should have a
variety of options provided by different companies from which to choose. The federal
government has taken many steps to ensure the availability of a healthy environment
open to competition through legislation, including limits on concept ownership through
Patent Law, prevention of monopolistic business practices through Anti-Trust
Legislation, and the outlaw of price cutting and gouging.

Right to Be Heard

This right asserts the ability of consumers to voice complaints and concerns about a
product in order to have the issue handled efficiently and responsively. While no federal
agency is tasked with the specific duty of providing a forum for this interaction between
consumer and producer, certain outlets exist to aid consumers if difficulty occurs in
communication with an aggrieving party. State and federal attorney generals are
equipped to aid their constituents in dealing with parties who have provided a product or
service in a manner unsatisfactory to the consumer in violation of an applicable law.

Right to Satisfaction of Basic Needs

To have access to basic, essential goods and services: adequate food, clothing, shelter,
health care, education, public utilities, water, and sanitation.

The Right to Redress

To receive a fair settlement of just claims, including compensation for
misrepresentation, shoddy goods or unsatisfactory services.

Right to Consumer Education

To acquire knowledge and skills needed to make informed, confident choices about
goods and services, while being aware of basic consumer rights and responsibilities
and how to act on them.

Right to a Healthy Environment

To live and work in an environment which is non-threatening to the well-being of present

and future generations.

Consumer Protection

Even though consumers have these rights, they can easily be ignored. That’s where
consumer protection comes in. Consumer protection consists of laws and organizations
designed to ensure the rights of consumers, as well as fair trade competition and the
free flow of truthful information in the marketplace. The laws are designed to prevent
businesses that engage in fraud or specified unfair practices from gaining an advantage
over competitors and may provide additional protection for the weak and those unable
to take care of themselves.

Organizations that promote consumer protection include government organizations,

individuals as consumer activism, and self-regulating business organizations, such as
consumer protection agencies and organizations, the Federal Trade Commission, the
Better Business Bureaus, etc.

Consumer interests can also be protected by promoting competition in the markets,

which directly and indirectly serve consumers, consistent with economic efficiency.

Forces in Consumerism

The modern understanding of consumerism refers to an emphasis on the consumption

of goods, often with a connotation of excess.

LEARNING OBJECTIVES

Discuss the forces driving the evolution of consumerism as an economic order that encourages
the purchase of goods and services in ever-greater amounts

KEY TAKEAWAYS
Key Points

 The modern definition of consumerism, derived from the works of economist

Thorstein Veblen, refers to the preoccupation with the acquisition of goods.
 Though consumerism is an international and historical phenomenon, it was
magnified dramatically by the Industrial Revolution, which made mass production
of consumer goods a reality.
 With the progression of mass production and consumption, some argue that
materialism and desire for social status became more prominent in cultures
around the world. Modern consumers are now able to emulate the wealthy and
iconic through consumption of certain goods.
 Increasing awareness of environmental and social concerns has given rise to
ethical consumerism. Consumers are becoming much more conscious of how
their consumption behavior is impacting the world around them, and they are
beginning to change their purchasing decisions accordingly.

Key Terms

 consumerism: An economic theory that increased consumption is beneficial to a

nation’s economy in the long run.
 conspicuous consumption: A public display of acquisition of possessions with
the intention of gaining social prestige; excessive consumerism in order to flaunt
one’s purchasing power.
 ethical consumerism: consumption of goods and services with a conscious
awareness of ethical and environmental implications

Consumerism

Consumerism is a social and economic order that encourages the purchase of goods
and services in ever-greater amounts. The term is often associated with criticisms of
consumption starting with Thorstein Veblen. While the term “consumerism” is also used
to refer to the consumerists movement, consumer protection or consumer activism, the
focus of this section relates to the first definition.

In economics, consumerism refers to economic policies that place emphasis on

consumption. In an abstract sense, it is the belief that the free choice of consumers
should dictate the economic structure of a society (cf. Producerism, especially in the
British sense of term).

The term “consumerism” was first used in 1915 to refer to “advocacy of the rights and
interests of consumers” (Oxford English Dictionary). Today the term consumerism more
commonly refers to the, “emphasis on or preoccupation with the acquisition of consumer
goods” (Oxford English Dictionary), a movement that emerged in the 1960s. This more
modern conceptualization is based on the writings of sociologist and economist
Thorstein Veblen who lived at the turn of the 20 th century. He coined the term
“conspicuous consumption” to describe this apparently irrational and confounding form
of economic behavior. Veblen’s scathing proposal was that unnecessary consumption is
a form of status display.