The Effect Of Society’s Evolving Norms on the Marketability of a Commodity

The ever-changing nature of society’s preferences has been a major determinant of the demand of a certain commodity, as trends dictate what consumers tend to purchase. This seems to be especially true for coffee in the USA, where sales have skyrocketed since the beginning of the decade.

Two factors may be the cause for this surge in sales: profuse advertising and larger employee requirements. The USA has become the most “overworked” nation in the world, where the average full-time employee works over 47 hours a week. This steady increase in work hours seems to coincide with the increase in market share for coffee. This could be attributed to workers’ attempts to prolong their working hours by obtain “energy” from caffeine, a constituent of coffee. Its omnipresence allows for ease of purchase, while its contents make for an addictive product. Moreover, advertisers are able to utilize several heuristics in order to promote coffee, portraying it as a “lifestyle” as well as a staple in people’s diets.  Its ability to provide energy (16 kj in a single espresso shot)  in conjunction with taste subsequently makes it alluring to the average individual. Consequently, consumers fall prey to the bandwagon effect, where a popular product consumed by some gradually becomes popular among others. It is also possible that consumer’s inadvertently exercise salience bias, as people may overlook its addictive nature in favor of its purported advantages. Hence, it would be plausible to state that coffee has become a necessity in essence, transcending niche markets to becoming part of a daily routine for consumers all over the world. 

As a result, the demand for coffee could be considered largely price inelastic, where these increases in price will result in a less than proportionate decrease in quantity demanded. Given this fact, producers know that if prices for coffee were to be raised, their revenue would increase, as the quantity demanded of coffee would largely remain the same. Therein lies the issue: irrepressible demand solely paves the way for inflation. As coffee beans are cultivated and sent out to various distributors, the price can be marked up in relation to this high demand, and only increases until the point it is sold. 

The price elasticity of the supply of coffee, on the other hand, seems to be a more complex case, where in the short term, the supply may tend to be price elastic. This is due to the fact that producers are currently able to draw on their stores of coffee, and can easily alter the quantity supplied in response to a price change. However, as the amount of resources for coffee decreases in relation to the USA’s consumer wants for coffee, these supplies are bound to run out. Additionally,  the main producers of coffee, such as Brazil and Vietnam, are largely labour-intensive, and are, as a result, susceptible to external conditions such as weather damaging potential sources of coffee. The time taken to produce more coffee in relation to the increasing demand would be fairly long, as it is with most agricultural products. Hence, in the long term, the supply of coffee would be price inelastic. Hence, inflation coupled with low supplies will only result in extortionate prices, as coffee futures seem to be set at a 20% increase. 

Therefore, due to changing trends in society, consumers often must alter their behaviour in relation to evolving needs. Amidst greater work demands and increasingly effective advertising, more and more units of coffee are purchased, and the commodity could now be considered a necessity. This, however, brings about issues of scarcity and inflation, where coffee becomes rare and expensive. Thus, it follows that as societal norms  radically influence a product to the point that it becomes a necessity, they may give rise to a volatile market operating at a higher price point.

( From Grand View Research: “U.S. Hot Drinks Market Trends, Size, Share | Industry Report 2018–2025.” Grand View Research, Apr. 2018, www.grandviewresearch.com/industry-analysis/us-hot-drinks-market. )

Aditya Bhargava

American Community School, Beirut

The Relationship Between a Person’s Income and Happiness

There is a common notion that wealthier people are generally happier and more content than those who do not earn that much. No one denies that money can provide you with a better lifestyle and is a prerequisite to fulfilling one’s material desires. 

Being multidimensional and abstract, it would be detrimental to happiness to think that money is more important than other values. Social relationships are an essential part of happiness and it seems that this kind of materialism can detract from social relationships. Income is a perpetual goal and thus it might be harder to achieve than other goals unless one puts a cap on desires. Income also facilitates an environment with more social inequality and increases the gap between the rich and poor.  

While you might be able to buy that new iPhone or television that everyone has been talking about, it may not provide everyone the same happiness that spending some time with your parents or catching up with an old friend would. Independent, this happiness, uniquely obtained from social relationships or other non-material methods, cannot be substituted with the purchase of a commodity.    

Material ambitions are monotonic among people of different income groups i.e. more income should bring greater happiness. One would believe that an increase in income, cetris parabus, would have a favorable impact on happiness. However, this assumption does not hold in reality. As income grows, so too do ambitions and aspirations. This undermines the favorable effect of income growth on happiness. Being optimists, humans tend to believe that they would be happier in the future because they project current aspirations to be the same, while income level rises. But since aspirations and income go hand in hand; aspiration levels also grow along with income. Inevitably, experienced happiness is systematically different from projected happiness.  

Despite having money, there are a lot of things that contribute to a person’s happiness which one might not be able to buy with a better income. Things like respect, a cleaner environment, social equality, a loving family and so on cannot be bought by money. Yet, it is desired by everyone.  

Indeed, income is a significant contributor to a person’s happiness. Income and happiness do go hand in hand but the latter is not the sole determinant of the former. Thus, it is important to keep in mind other factors, often entirely independent of income, that play a key role in determining an individual’s happiness.  

Isha Aggarwal

Lotus Valley International School, Noida