Great recession and U.S. consumers' bulimia: deep causes and possible ways out
AbstractThis paper attempts to shed light on some aspects of the U.S. consumers?apparent bulimia that was at the origin of the recent global crisis. We seek to show how different characteristics of the American society and economy, which are usually considered separately, are consistently related to such a multifaceted phenomenon. Hence, we illustrate some structural features of the U.S. economy and public policies that may contribute to create a difference, in terms of patterns of consumption and participation in market activities, between the U.S. and some other advanced economies (in particular, the major economies of continental Europe). We then proceed by presenting some explanations of the U.S. hyper-consumerism. We do so by introducing concepts and analyses elaborated by psychologists and sociologists that may help relating this phenomenon to the decline in subjective well-being and social capital documented in the U.S. over the period preceding the crisis. Moreover, we discuss how the NEG (Negative Endogenous Growth) paradigm can account for the recent U.S. consumption boom by treating it as part of the typical reinforcing loop that characterizes the U.S. pattern of economic growth. Finally, we focus on how the U.S. can exit from the current crisis: we underline some weaknesses of the two politically more realistic policy alternatives, and we outline a third exit strategy, which would possibly be preferable in terms of people?s long-term well-being.
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Bibliographic InfoPaper provided by CEPS/INSTEAD in its series CEPS/INSTEAD Working Paper Series with number 2012-23.
Length: 44 pages
Date of creation: Apr 2012
Date of revision:
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hyper-consumerism; working time; negative externalities; hapiness; growth rebalancing;
Find related papers by JEL classification:
- D10 - Microeconomics - - Household Behavior - - - General
- D60 - Microeconomics - - Welfare Economics - - - General
- E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
- F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
- I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
- O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-05-02 (All new papers)
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