Black Friday

Only after you have absorbed an economic concept does it seem like common sense. Economics is like any other discipline in life. Take for instance riding a bike. At this point in life if someone asked you how you ride a bike you would probably say “its common sense”. But think back to when you were learning to ride a bike or drive a standard car and all the frustrations and difficulties that you struggled through. Once you understand the “common sense” fundamentals of economics you can apply them in ways that you had not thought of before. The way that you, (and most people), have been introduced to economics (principles of micro and macro economics) you are left little room for variance and practical alternative economic perspectives (at least at first). Although boring, these necessary fundamentals lay the foundation from which you build upon a system of knowledge (If you follow the discipline).

Let us go back to the beginning to the essence of economics which is "the science which studies human behavior as a relationship between ends and scarce means which have alternative uses." This means that available resources are insufficient to satisfy all wants and needs. Through this definition you can begin to see how economics becomes more than taxes, business, money and other things you “don’t need to know about”.

Being Black Friday I thought it would be appropriate to analyze this day from an economic perspective. Every year on this day following Thanksgiving businesses have sales to incentivize consumers to buy their products in hopes of going “into the black” (become profitable). This is all part of a larger cyclical economic system designed to make people feel as though they need to buy things in an attempt to boost the economy.

Typically Black Friday uses low prices as an incentive to buy things, but there other techniques, like planned and technical obsolescence, that are used throughout the year to add to consumer’s desire to buy.

Obsolescence is the state of being which occurs when a person, object, or service is no longer wanted even though it may still be in good working order.

Sometimes marketers deliberately introduce obsolescence into their product strategy with the objective of generating long-term sales volume by reducing the time between repeat purchases. One example might be producing an appliance which is deliberately designed to wear out within a predetermined length of time of its purchase, pushing consumers to replace it within this time period. This tactic is what is known as planned obsolescence.

Walk into a Best Buy or a Wal-Mart, stop, look up and take a minute to think: Where did all of this stuff come from? These products are all made from natural resources that are extracted from the earth in one form or the other at different rates. Some of the natural resources are exhaustible making them a scarce and limited resource. Next think about all of the chemicals and toxic materials that were used in the process of bringing these items into existence. We inevitably face trade offs between environmental degradation and the production and consumption of goods.

Our nation has been raised on advertising and television to believe that we need to buy things in order to feel good about ourselves, chasing cars and clothes perpetuating a never ending cycle of consumption only to be persuaded by the “next best thing”.