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American Standards of Living:1918-1988

Emulation and Innovation

As hypothesized in chapter 2, periods of slow or declining income growth would be the most disruptive to consumption norms. Fami-lies would not be able to buy innovative goods and services and to emulate past practices without sufficient income growth. In addition, the pressure to innovate would intensify as the economy matured and variety and status were impacted in consump-tion. Disruption in consumption norms occurred especially between 1918 and 1935, which is the survey period with the most remarkable discontinuity in consumption norms and the only period with a decline in national income. (See Figure 8.3). Economic distance increased at both ends of the income spectrum ¾ between the working class and blacks and between the salaried class and the working class. Working--class families reduced their family size and reduced their consumption in clothing, household opera-tions, and gifts in order to buy innova-tion in food, housing, utilities, and transportation. At the same time, only one-fifth of emulation (the imitation of traditional patterns) was real-ized.

The other period of disruption in consumption norms occurred during slow, but not negative, national income growth, 1973-1988. Families once again reduced their family size and spent some savings, but this time they reduced their standards in only one area ¾utilities ¾ in order to purchase innovation in gifts, recre-ation, clothing, and household operations. Emulation of previous norms was almost nonexistent.

During the period with the highest national growth rate, 1935-1950, less innova-tion occurred than during the low or negative growth eras. After expanding in the previous period, economic distance shrank at both ends of the income distribution. Laborer families tried to offset their loss of eco-nomic distance from blacks by reducing their family size and utilities in order to exceed the other classes in innovation, especially in food and transportation. Since salaried families experienced the slowest budget growth across the classes, they had to spend most of their budget increment on innovation in order to appear modern. In contrast, working-class families experienced faster growing budgets and so were able to purchase innovation as well as some emulation.

The other era of high national income growth, 1950-1973, witnessed much more emulation and slightly less innovation with less reduction in standards than in the preceding high growth era. Families purchased innova-tions in housing and utilities, transportation, household operations, and recreation. Overall, families witnessed the least disruption to consump-tion norms of any period surveyed, and this period is remembered nostalgically as the golden era of attaining new heights in living standards.

Veblen’s theory of emulation seemed to hold only when incomes grew sufficiently rapidly in an economy of mostly basic consumption. When incomes grow slowly, families will purchase innovations rather than emulate, and consumption norms are disrupted. This process of innovation at the expense of emulation intensifies in a mature economy. When some older practices are modified or dropped and some new practices are added, families seem to feel less well off. They tend to overvalue the lost emulation and undervalue the innovations, which they take for granted.

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