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Encyclopedia > Consumption (economics)

In economics, consumption refers to the final use of goods and services to provide utility. This article needs additional references or sources for verification. ... Good. ... Services are: plural of service Tertiary sector of industry IRC services Web services the name of a first-class cricket team in India This is a disambiguation page — a navigational aid which lists other pages that might otherwise share the same title. ... In economics, utility is a measure of the relative happiness or satisfaction (gratification) gained. ...

Contents

Keynesian economics and aggregate consumption

In Keynesian economics aggregate consumption is total personal consumption expenditure, i.e., the purchase of currently produced goods and services out of income, out of savings (net worth), or from borrowed funds. It refers to that part of disposable income (income after taxes paid and payments received) that does not go to saving. Keynesian economics, or Keynesianism, is an economic theory based on the ideas of John Maynard Keynes, as put forward in his book The General Theory of Employment, Interest and Money, published in 1936 in response to the Great Depression of the 1930s. ... This article needs additional references or sources for verification. ... A good or commodity in economics is any object or service that increases utility, directly or indirectly, not be confused with good in a moral or ethical sense (see Utilitarianism and consequentialist ethical theory). ... Save might refer to: Save (sport) - to stop a goal or maintain the lead To save a document in computer file management (see also Saving a webpage) The River Save (Zimbabwe), Zimbabwe The River Save (Hungary), Hungary -- joins the Danube just above Belgrade. ...


Discussions of human consumption of resources play an important role in both economics, environmentalism and geographical analysis.


In Keynesian economics, "consumption" is short-hand for personal consumption expenditure and is determined by the consumption function, especially by the marginal propensity to consume. It is part of aggregate demand or effective demand. Keynesian economics, or Keynesianism, is an economic theory based on the ideas of John Maynard Keynes, as put forward in his book The General Theory of Employment, Interest and Money, published in 1936 in response to the Great Depression of the 1930s. ... In economics, the consumption fuction calculates the amount of total consumption in an economy. ... The marginal propensity to consume (MPC) refers to the increase in personal consumer spending (consumption) that occurs with an increase in disposable income (income after taxes and transfers). ... In economics, aggregate demand is the total demand for goods and services in the economy (Y) during a specific time period. ... Effective demand (in macroeconomics often seen as synonymous with aggregate demand), refers to the very simple economic idea that says that its not enough to want something such as food or luxuries. ...


Consumption can also be defined as "the selection, adoption, use, disposal and recycling of goods and services", as opposed to their design, production and marketing.


History

John Maynard Keynes developed the idea of the consumption function, which sees a consumption as consisting of two main parts: John Maynard Keynes, 1st Baron Keynes, CB (pronounced cains, IPA ) (5 June 1883 – 21 April 1946) was a British economist whose ideas, called Keynesian economics, had a major impact on modern economic and political theory as well as on many governments fiscal policies. ... In economics, the consumption fuction calculates the amount of total consumption in an economy. ...

  1. Induced consumption refers to increases in consumer spending that occur as disposable income rises. Increases in consumption follow the famous marginal propensity to consume. An increase in disposable income leads to an increase in consumption, moving along the consumption function in a graph.
  2. Autonomous consumption refers to consumption spending done as part of long-term plans for the future (smoothing out income fluctuations, providing for retirement and other expected future events, etc.) and as a result of habits and contractual commitments. Changes in plans, expectations, habits, etc. leads to shifts of the consumption function in a graph.

Often, as in the permanent income hypothesis, the word "consumption" refers instead to the benefit received from consumer goods and services (as opposed to the amount spent on such products). Consumer demand or consumption is also known as personal consumption expenditure. ... The marginal propensity to consume (MPC) refers to the increase in personal consumer spending (consumption) that occurs with an increase in disposable income (income after taxes and transfers). ... To meet Wikipedias quality standards, this article or section may require cleanup. ...


Studies

Studies of consumption investigate how and why society and individuals consume goods and services, and how this affects society and human relationships. Contemporary studies focus on meanings, role of consumption in identity making, and the 'consumer' society. Traditionally, consumption was seen as rather unimportant compared to production, and the political and economic issues surrounding it. With the development of a consumer society, increasing consumer power in the market place, the growth in marketing, advertising, sophisticated consumers, ethical consumption etc, it is recognised as central to modern life. Sociology of consumption has moved well beyond Veblen's early work on 'conspicuous' consumption. Current theories investigate the role of economic and cultural factors in constraining consumption, as development of an approach that sees consumers as 'victims' of producers and their social situation. A counter theory highlights the subversive aspects of consumption, with consumers buying and using goods, places etc in ways unintended by the producers. Examples include city squares turned to skateboard parks, and music sharing on the internet. This article or section includes a list of works cited or a list of external links, but its sources remain unclear because it lacks in-text citations. ... Thorstein Bunde Veblen (born Tosten Bunde Veblen July 30, 1857 – August 3, 1929) was a Norwegian-American sociologist and economist and a founder, along with John R. Commons, of the Institutional economics movement. ... Conspicuous consumption is a term used to describe the lavish spending on goods and services that are acquired mainly for the purpose of displaying income or wealth. ...


Studies of consumption come from a variety of backgrounds. Consumer studies attempt to help marketing. User research aims to improve product design. Feminist studies highlight the importance of women as consumers, and particularly the role of the domestic arena in consumption. Media studies try to understand the consumption of media products such as television and video games. Critical Theory is an important influence on contemporary studies, as consumption is central to contemporary culture. Feminism is a social theory and political movement primarily informed and motivated by the experience of women. ... Media Studies is the academic study of the constitution and effects of media. ... In the humanities and social sciences, critical theory has two quite different meanings with different origins and histories, one originating in social theory and the other in literary criticism. ...


Studying consumption can be done through traditional survey methods, or various ethnographic techniques. Consumption studies are difficult because they involve investigating everyday life situations, bringing research into the private domain, rather than formalised settings such as the workplace. I like to eat ice cream. Ethnography (from the Greek ethnos = nation and graphe = writing) refers to the qualitative description of human social phenomena, based on months or years of fieldwork. ...


Bibliography

  • Pierre Bourdieu (1979) 'Distinction', Routledge
  • Daniel Miller (1998) 'A Theory of Shopping', Polity
  • Slater (1997) 'Consumer Culture and Modernity'
  • Friedman (1994) 'Consumption and Identity'
  • Mackay (1997) 'Consumption and Everyday Life'
  • Mary Douglas and B. Isherwood (1979) 'The World of Goods', Routledge

Pierre Bourdieu (August 1, 1930 – January 23, 2002) was an acclaimed French sociologist whose work employed methods drawn from a wide range of disciplines: from philosophy and literary theory to sociology and anthropology. ... Daniel Miller (1954-) is an anthropologist most closely associated with studies in material culture and consumption. ... Dame Mary Douglas, DBE, (born March 25, 1921 - died 16 May 2007) was a British anthropologist, known for her writings on human culture and symbolism. ...

See also


  Results from FactBites:
 
AllRefer.com - consumption (Economics: Terms And Concepts) - Encyclopedia (397 words)
consumption, in economics, direct utilization of goods and services by consumers, not including the use of means of production, such as machinery and factories (see capital).
Consumption is also viewed as a basically subjective phenomenon, with individual utility, or satisfaction, assuming primary importance.
Contemporary economics has increasingly concerned itself with studying total consumption in an effort to implement effective government controls of the business cycle.
Consumption (economics) - Wikipedia, the free encyclopedia (604 words)
Consumption can also be defined as "the selection, adoption, use, disposal and recycling of goods and services", as opposed to their design, production and marketing.
Current theories investigate the role of economic and cultural factors in constraining consumption, as development of an approach that sees consumers as 'victims' of producers and their social situation.
Consumption studies are difficult because they involve investigating everyday life situations, bringing research into the private domain, rather than formalised settings such as the workplace.
  More results at FactBites »

 
 

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