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? Micro and Macro Economics Prospect Theory and Framing in Negotiations ?

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According to ShUSla (2009) consumerism is primarily the consumption of goods at a higher rate. He points out that every economy normally depends on both production and selling of goods and that the more goods produced and consumed by the society the higher economic growth rate it receives. On the other hand Rangarajan (2006) notes that globalization captures primarily the process that describes the integration of regional economies, societies and culture through communication, transportation and trade. He further notes that this increase in the consumption rate has greatly influenced the integration of economies and societies. The consumption rate on the other hand is equally influenced by globalization because it is based on individual’s cultural, social, political and economical status. This write up seeks to explain the interrelation between consumerism and globalization in relation to their economic, environmental and social impacts.

Consumerism and Globalization Vs the Global Economy

According to ShUSla (2009) the stability of economy is based on the people’s purchasing power, which in a nation depends on per capita income of individuals. He points out that with globalization; the production, distribution, and manufacturing processes have had to change. It caused a great influence on the society especially on their purchasing power. He points out that consumerism has a positive impact on the economy as more nations relate. This relationship has led to nations investing in other nations, which in return increases their productivity and thus increases the employment opportunities. Shulka (2009) noted that this has led to the advancement of various projects and industrial programs in enhancing quality goods and services.

According to International Monetary Fund (IMF), the economic and financial globalization has lead to the expansion of the world trade services that has benefitted most of the countries. The body through its website however points out that the financial crisis has impacted negatively on global capital flows which have lead to less global trading. This has in turn negatively affected the consumption rate of the various goods based on low financial income. According to Zhu (2011), the global economy has entered a dangerous phase of financial crisis. He points out that the rising of financial stress has lead to the global suffering from collective crisis of confidence. This has contributed to low consumption rate, less investment and eventually less job creation.

Zhu (2011) points out that the global financial crisis has not only negatively imposed on the global economy but it has also adversely affected the social cost. He notes that the continued global financial market stress affects negatively the consumption of goods. In his context, during the market financial crisis most of the investors tend to withdraw from the market as they flew to safety, where there is a promising capital outflow. According to him, the withdrawal of various investors from the market means the withdrawal of certain basic commodities, which affects the consumption rate. He argues that this is an indication that consumerism is primarily based on global economic trend.

According to Rangarajan (2006), the globalization of the financial markets has integrated the trading of products in the market, which has in turn influenced consumption rate. He points out that the international trade has involved immense technological approach, which has seen more manufacturers using advance concepts in exposing their products to the consumers. According to him, international trade has lead to allocation of resources to various markets that can easily be accessed by consumers. This in his context has lead to specialization, and it has enhanced productivity. He notes that the globalization efforts have made markets to exploit foreign goods through technological regime, which has seen consumers benefitting from foreign products.

The globalization trend on the inventory of new technologies have influence the income generating sources that have inflicted adversely on the world consuming effort. Elaborating on this, Wei, Wu & He (2011) pointed out that the technological inventory of integrated electricity supply has improved the electricity consumption level in various nations. They noted that the cordial relationship between the energy consumption and the economic growth of China, for example, has been influenced by the approach of the H-P filtration technology. They also observed that there is a positive relationship between the total energy consumption and the gross domestic product (GDP), which has resulted in an increased consumption rate. They note that the globalization effect has seen the rise of energy consumption based on the energy saving and cost saving ability as more consumers get informed of consumption strategies.

Consumerism Effect on Environment

According to McAusland (2008), consumerisms of many products have allowed the rise of industries in the production of goods to certified consumers’ needs. He points out that this has lead to substantial growth of trade over the years in both the value and the volume. He argues that this has made more industries to deploy selfish economic gain in boosting their financial gain without reprimanding on adverse environmental impact. He pointed out that the competition for wealth possession among nations has seen industrial nations polluting the environment in attempt to satisfy consumer consumption needs.

McAusland (2008) pointed out that the existing of international trade has lead to local pollution as more concerned industries emit both carbon and greenhouse gases. According to him, it is the rising consumer demand that has caused this rise of trade intensity and consecutive income generation. In his analysis, he pointed out that in every 1% increase in volumes of goods traded; there is a sub sequential 0.58% increase in Carbon dioxide gas emission for an average country. He notes that the assessment of the environmental impact of trade, especially related to greenhouse gas emission, is primarily determined by the nature of globalization. ShUSla (2009) also pointed out that consumerism has resulted to ecological imbalances as natural habitats are being destroyed to create more goods.

According to Brownstone (2009), the global population density influences the consumption rate. He points out that, the need of luxury has seen the rise of manufacturing of comfortable machineries like vehicles, which has impacted negatively on the environment due to the emission of gases. He notes that the residential density has adversely speculated on the need for globalization technology in their consumption efforts, which have seen an increase in fuel consumption. In his analysis on two Californian households of exceptional residential density, he explains that a lower density of 1000 housing per square mile implies an increase of 65 gallons of fuel per household. This in turn translates into an increase of gas emission to the environment.

Najam, Runnals & Halle (2006) points out that the global environmental concerns, mainly attributed by ecological processes, normally have impacts beyond borders. They note that the scale and composition of various economic activity changes leads to an increase in consumption rate. They argue that this anticipates the rise of more externalities in an effort to influence more productivity in satisfying the global consumer needs. They point out that globalization leads to better technological jobs, which in turn lead to an increase in an individual’s income. Further, they note that an income increase helps in creating more resources to aid in environmental protection.

According to Najam, Runnels & Halle (2006), the globalization trend has changed the governance perspectives of different countries. They point out that with the environmental effect felt beyond national boundaries; various states have found it difficult to only rely on national regulations to ensure well being of their citizens and the environment. Further, they illustrate that implementing nation regulation on environmental concerns have experienced impediments based on the global consumption rate. They argue that the rise of global population has called for improved technological schemes to ensure that the production rate meets the demand of the population. This has seen the rise of manufacturing industries, which in return has lead to an increase of environmental pollution due to industries’ pollutants emission.

Najam, Runnels & Halle (2006) point out that the link between the process of globalization and environmental degradation pose adverse food security threat to the world. They admit that these processes have post more risk to the livelihoods of poorest communities. For instance, they point out that through global environmental degradation, there is a competition of less basic commodities present. They attribute that water scarcity in world’s poorest nations caused by changes in rainfall and temperature has adversely affected the agricultural and industrial productivity. They point out that the Food and Agricultural Organization estimates that most of the developing nations may experience 11% decrease in agricultural activities by 2080 due to the climate changes. This will obviously affect consumerism.

Consumerism and Globalization Vs Social Effects

According to Brownstone (2009), consumerism normally results in the loss of things far more important to the human psyche than those gained by materialistic acquisitions. He notes that consumerism normally puts individual in wanting and possessing situations which in turns gives him/her little time and energy to concentrate on meaningful things in life. In this context, the act of possessions generally leads to selfishness, in determining various consumption efforts. He points out that the purchasing of vehicles by each family member of the higher population density household demonstrates this act of selfishness. He notes that even though this act shows economic growth, it has adverse effect on both the social life and the environment.

According to ShUSla (2009), consumerism has lead to the increase in crime rate based on selfish gain. He points out that the increase in global crime rate is a result of an increasing demand by individuals to posses increasing expensive gadgets. He expresses that consumerism has globally changed people’s lifestyle as more people tend to change to lavishing lifestyle rather than simplicity. He further notes that in such desirable conditions, based on depression, which is influenced by jealousy and envy, individual’s psychological health is at stake.

Effect on Social Movements

Mc Michael (2011) points out that there is a need to advocate social movements in addressing the underlying issues that are caused by globalization effects. He notes that intense globalized market system tries to dissocialize the capital from social and political bond. According to him, this has affected the social distribution process, which has in turn affected consumerism. He argued that through social movements, there has been an increase in various global development projects. He has seen the rise of productivity that has impounded positively on the global consumption. He also notes that there has been a rise of social movements based on the income inequalities and land grabbing, which adversely affects agricultural productivity.

According to Singh (2011), due to the present economic conditions, characterized by liberalization of trade barriers, it is important to advocate for consumers’ rights. He points out that various Consumer Protection Laws have been developed to protect consumers against exploitations and abuse by goods and services providers. He observed that since the formation of the society consumer right group in Britain in 1844, there has been wide legislations on consumer rights.

According to Singh (2011), the scientific and technological advancement of the variety of consumer goods has projected the markets complexity that has affected the consumption rate. He points out that the advertisement of various products based on their taste, flavor, style and quality have lured most of the consumers in defining their economic status. In this context, most of the manufacturers have used advanced global technology in influencing the consumer availability in purchasing various products. According to Singh (2011), this has exploited many consumers to work on higher jobs scales that can earn them better income by means of which they can purchase these products.


In conclusion, this write up has correlated the relationship between consumerism and globalization. It has pointed out that globalization trend is primarily influenced by consumerism and vise verse based on both consumer’s needs and global influence. This interaction has also had both the positive and negative impact on the society. The negative effects of the two processes on the environment are for example a call for the need for innovation and use of the technologies that do not pose threat to the environment.

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