Income, Social Class, and Family Structure Flashcards
Income Patterns
-Whether a skilled worker or a child of privilege, social class has a huge impact on one’s life
-Status symbols are valued as markers of social class
-Canadian living standards are high and improving
-A larger proportion of people of working age are in the labour force
-2015, employment trends for women showed an increase from 47 to 69 percent
-2015, employment trends for women showed an increase from 47 to 69 percent
-In couples with children 75 percent are dual-earning couples
-Education pays off in the long run
-Canadian adults ages 25 through 64 with a college diploma or a university degree rose from 48.3 percent to 54 percent.
-Rate for graduates of college and university programs was 82%
-graduates from university programs with a bachelor’s degree earned 58 percent more on average than did those who only graduated from high school.
To Spend or Not to Spend
Consumer demand = willingness to buy + ability to buy
-Discretionary incomeIs the money available to a household over and above that required for a comfortable standard of living.
*Changes as a household ages-
Older households spend a much larger share of budget on shelter and transportation, and less on food and apparel
*Households are spending more now on entertainment and education
Individual Attitudes Toward Money
-2008 recession influence
*Frugal types: spendthrifts and tightwads
-Walmart study identified three distinct groups of consumers:
*Brand aspirationals: on low incomes but obsessed with names like KitchenAid.
*Value-price shoppers: who like low prices and cannot afford more.
*Price-sensitive affluents: wealthier shoppers who love deals.
Consumer Confidence
-Behavioural economics/economic psychology-Is concerned with the “human” side of economic decisions
*Consumer confidence: Extent to which people are optimistic or pessimistic about the future health of the economy.
Influences how much discretionary money we will pump into the economy.
-Overall savings rate is affected by:
*Pessimism/optimism about personal circumstances
*National and World events
*Cultural differences in attitudes toward savings
Social Class
Social class -is determined by a complex set of variables that include income, family background, education, and occupation.
*“Haves” vs. “have-nots”
*Our place in the social structure determines how much we spend and how we spend it
Think about it: Is it right to judge people based on social classes, or does it matter at all?
Picking a Pecking Order
-Dominance-submission hierarchy
*Pecking order: relative standing in society
*Standing determines access to resources -Education, housing, consumer goods
*We try to improve our standing by moving up social order whenever possible
*Marx – means of production
*Max Weber – status groups
*Marketing strategies focus on this desire to move up in standing
*Homogamy – birds of a feather flock together
*Class can affect prospects in life
-May improve chances in school
-And in work
*Social stratification
-Sharing out resources unequally through artificial divisions
-Reputation economy
Achieved versus Ascribed Status
-Achieved Status: Earned through hard work
-Ascribed Status: Born with a silver spoon
-Most groups exhibit a structured or status hierarchy
Some members are somehow better off than others
Social Mobility
Income in equality-The extent to which resources are distributed unevenly within a population.
*Social mobility: passage of individuals from one social class to another
-Horizontal mobility (from one occupation to another in same social class)
-Downward mobility
-Upward mobility
Think about it: What consumption cues do you use (e.g., clothing, speech, cars, etc.) to determine social standing?
Class Structure in Canada
-Canada, in theory, does not have a rigid, objectively defined class system
-Canadians tend to maintain a somewhat stable class structure in terms of income distribution.
-What does change are the groups (ethnic and religious) that occupy different positions within this structure at different times
Class Structure Around the World
-Rise of Chinese middle class
Nike’s new brand presence there
-Japan as a status- and brand-conscious society
Single, working women spending on luxury goods
-Major retailers/brands are coming to Middle-Eastern countries, where Arab women enjoy shopping with their families/friends
-England’s rigid class structure still exists, but the dominance of its aristocracy is fading but marketers are still targeting chavs’ as a group
-India’s economy is booming, many poor but rich are preferencing high-end brands & credit cards
Blurring Social Class
-Many “luxuries” are now affordable to all
-People shop “cheap” in one area to shop “rich” elsewhere
*Even the wealthy shop at Walmart for basics
-The emerging BRIC economies
-Growing demand for mass class products globally
Components of Social Class
-Occupational prestige:
Some occupations are more respected than others
*Stable over time and similar across cultures
*Single best indicator of social class
-Income:
*Wealth is not distributed evenly across classes
*Income per se is not often a good indicator of social class; it’s the way money is spent and not how much is spent
*Education: related to both occupation and income
How Income Relates to Social Class
-“Money” and “class” not synonymous
-Whether social class or income is a better predictor of a consumer’s behaviour depends on the type of product:
*Social class is better predictor of lower to moderately priced symbolic purchases
*Income is better predictor of major nonstatus/nonsymbolic expenditures
*Need both social class and income to predict expensive, symbolic products
Class Differences in World View
*World of working class is intimate and constricted:
-Immediate needs dictate buying behaviour
-Dependence on relatives/local community
-More likely to be conservative/family-oriented
-Maintaining appearance of home/property
-Don’t feel high-status lifestyle is worth effort
Affluenza and pressure to maintain family status
*Strategic Insights study divided consumers into three groups:
-Luxury is functional: Logical purchases, not impulsive
-Luxury is reward: Younger people…I’ve made it!
-Luxury is indulgence: Lavish and self-indulgent
Old money v new money, rich vs poor : spend in different ways
Taste Cultures, Codes and Cultural Capital
Taste culture: Differentiates people in terms of their aesthetic and intellectual preferences.
*Distinguishes consumption choices among social classes
*Upper- and upper-middle-class: more likely to visit museums and attend live theatre
*Middle-class: More likely to go camping and fishing
*Some think concept of taste culture is elitist
