Affiliated School;
Food and consumption and what I'm particularly interested in is how our thinking of and about consumption is affected by, and affects economics.
Consumption forms the foundation of economics because it leads to demand of goods and services. Production of goods is based on the taste and preference of the consumer; giving the client what he wishes to have the most. Consumers are known to be subjective when it comes to what they consume (Lusk, 2011). In this case change in consumption patterns should lead to change in the goods and services produced. Firms should be flexible enough to offer the consumers what they require.
When it comes to food and consumption, especially in the contemporary society where consumerism is based on proper information, there is a lot of flexibility that is to be expected on both the demand and supply side of the economy. Currently there is an increase in lifestyle diseases that are as a result of consumption of food in the wrong quantities, consumers have changed their consumption patterns (Lusk, 2011). People are consuming less junk food, less fatty and fast foods and more vegetables, fruits and food supplements. This means that fast food restaurants are being put on the challenge of how flexible they are.
A good example is the McDonald Corporation that reported a loss of $711.7million in 2012, as opposed to a profit of $834.1million experienced the previous year due to decrease in their sales and law suits. Change is inevitable and flexibility should be embraced at all levels of commercial activities. This is because people in different generations cannot be expected to have the same taste and preference in food. The food industry should embrace that the quality and content of what is in their products is what consumerism is based on, not response to advertisements. Law is based on our beliefs and when people no longer believe in a product, it becomes illegal. This explains the increased number of law suits against fast food restaurants on producing high fat foods. In 1970s this was unheard of because people had completely embraced the fast food restaurants as the new thing in town.
Time comes with change in consumerism and it should reflect in the production side as well. Consumption forms a part of the GDP, so when it decreases because the consumers cannot be able to find goods to increase their utility, the entire country suffers the effects (Lusk, 2011).
References
International Business Times. (2012-05-22). "McDonald's Holds down Dollar Meal, Making Menu Healthier".. Retrieved 2013-07-23.
Lusk, L. J. Shogen, J. Roosen, J. (2011). The Oxford Handbook of the Economics of Food Consumption and Production, Oxford University Press, New York
