Back to Homepage Income Measures Income: Saving and Investment Methods of Buying That Save Money The Choice of Goods Methods of Buying That Reduce Mistakes In Selection Methods of Securing Information Concerning Goods Plans and Motives of Consumers Consuming the Product Who Is the Consumer? The Consumer in the Market Priorities and Preferences in Consuming Decisions The Consumer as User of Wealth The Consumer as a Buyer Consumers as Self-Conscious Agents Criteria of a Good Market Information Versus Persuasion of the Buyer The Rate of Interest Interest Rates and Economic Activity Saving, Investment, and Income Saving Motives Saving Plans and their Realization Total Spending Is the Key to Prosperity The More We Spend, The More We Have Spending by Private Enterprise

The Consumer as a Buyer The second most widely used definition of the consumer is essentially of commercial origin and includes all persons who buy. Here an attempt is made to discover something of the nature of the mechanisms of choice-making so that consumption trends might be controlled either for personal or social welfare or for profit. Persons who accept this definition, therefore, usually have in mind the buyer at retail, the ultimate purchaser. Thus, Winifred Frost refers to consumers as "typically small quantity buyers . . . who use goods to satisfy personal and family needs, without the object of making money out of their use." Others, however, including the New Deal consumer agencies, extend the term to include all persons who buy regardless of the reason for purchasing. "The Consumers' Advisory Board," says Keezer, "rejects the very general view that the consumer is merely the buyer at retail. It concerns itself with the welfare of the buyer of heavy steel products as well as of bread and chewing gum. This is done on what seems to be the very valid theory that if the purchaser in the intermediate steps of production and distribution is unfairly treated, the unfair treatment must be reflected in the retail markets." Even had there not been at the time a specific section of the N.R.A. working, in conjunction with hundreds of codes, to prevent the "unfair treatment" of industry, one might question the peculiar nature of this definition of the consumer. It has already been shown in a previous chapter that consumption is quite a different function from the refabrication of things in the creation of new or greater utility. In the former case goods are consumed in the gratification of wants; in the latter case, values are produced. The protection of the producer as a buyer by a public consumer's agency becomes, therefore, something of an anomaly. As an explanation, one writer suggests that "in his present Washington role, the consumer was conceived as part of a theory and born in principle. . . . On paper he appeared as a component part of a neat and pleasant design." The relation of that pleasant design to economic reality was apparently of small importance to the designers. With the exception of these consumer agencies of political origin, however, types of buying are clearly differentiated and the consumer recognized as the purchaser at retail only. The procedure involved when the manufacturer buys raw materials, or when the retailer buys from the wholesaler or manufacturer, is rarely confused with the activities of the ultimate consumer. For those in business know that the motives and practices regulating producer-buying are radically different from the determinants of consumer choice. The two processes involve divergent functions, the economic significance of which is not reducible to common terms. If, however, the retail buyer is the consumer, then the typical consumer is a woman. The 62% of all women in the country who are housewives, together with the 17% 2 who are gainfully employed, control between 65 and 90% 3 of all retail sales in the process of spending about 42% 4 of the total national income at the rate of almost $1,000 a second. 5 The standards of the things demanded by these consumers are usually established by young women "25 to 35 years of age" who "graduated from high school some years before " and who are " highly ambitious and still striving to make good." 6 Because of restricted purchasing power, they exercise great care in the selection of consumables and, in this sense, determine the broad trends of both production and consumption. In more recent years, the male's influence on demand has been growing. "His judgment," observes one writer, "even his good taste, is beginning to receive what may fairly be described as respectful attention." D. H. Palmer is of the opinion that men are typically the choice-makers in the purchase of electrical or mechanical contrivances such as electric stoves, oil-burning furnaces, washing machines, automobiles; mechanical refrigerators, and the like. Returning to our analysis, the validity of this definition of the consumer as the ultimate buyer depends largely on the point of view. To the merchant, the wishes of the choice-maker are profoundly important and in the end determine the degree of the enterpriser's success or failure. For practical commercial purposes, therefore, the consumer is the retail purchaser, and a study of the buyer's needs, motives, and eccentricities will furnish the insight requisite for the effective prediction and control of demand. The student of economics, however, has a more extensive interest in the consumer. Where the first definition outlines the consumer's function, the second indicates the manner of its expression. The consumer as an economic type, however, has not yet been defined, nor have his characteristics been enumerated. It is to this task that we again turn.   Home