Posts Tagged ‘Consumer behavior’

Book Review: An economist gets lunch

Monday, May 7th, 2012

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Cowen, Tyler. An economist gets lunch : new rules for everyday foodies. Dutton, 2012.

The words “everyday foodies” in the title of Tyler Cowen’s book were what first attracted my interest. Even though I plead guilty to being a “foodie”, I cringe a bit inside when I write or say it. The word has an elitist whiff to it.

An “everyday foodie” sounds more down-to-earth and approachable; and much of An Economist Gets Lunch focuses on distinguishing the behaviors of the everyday foodie from those of the food snob and the thoughtless consumer. Cowen does readers and mindful eaters a great service by explaining both the positive and negative effects of America’s food supply chain. He also provides guidelines to help the reader make every meal count, realize that good food is often cheap food, and to be innovative as consumers.

If you’ll pardon the pun, the meat of An Economist Gets Lunch begins in Chapter 7 (“Another Agricultural Revolution, Now”).  Cowen starts with the revelation that corn as we now know it is the product of progressive genetic engineering, i.e. selective breeding, practiced over millennia by farmers in central Mexico. It was the first “Green Revolution”.

This will probably surprise readers who reflexively refer to modern day genetically modified grains as “Frankenfood”. Cowen’s passionate and well-reasoned defense of GMOs (genetically modified organisms) later in the chapter is foreshadowed by his description of the third Green Revolution — the adaptation of American agricultural technologies for practical use in poorer countries to improve crop yields and dramatically reduce deaths from hunger. According to Cowen, these benefits of technological progress and agricultural commercialization demonstrate that “the agribusiness platform … the food infrastructure of the modern world, is one to build upon and improve, rather than throw away.”

It may sound as if the author is a full-throated supporter of Big Agribusiness; but his arguments for carbon taxes set by governments to modify consumer behavior makes it clear that this is not the case.  It is ironic that Cowen spends many pages empowering consumers to make intelligent, thoughtful choices about how and what they eat; yet he concludes here that it would be just too difficult for consumers to accurately make choices about what foods are the most or least “green”.

Another irony, really a self-contradiction, is Cowen’s suggestion to “minimize the number of car trips” required to support food consumption; and yet throughout the book, he emphasizes the value of increased travel as critical to the education and experience of the everyday foodie.

An Economist Gets Lunch is an interesting and informative read in that it opens readers’ eyes to the currently under-reported benefits of our US food supply chain, and the humanitarian value of GMO food crops. But the “food advice” chapters progressively read like lightly edited blog posts, and assume readers will have access to a metropolitan setting like the author’s.  Cowen’s generalizations about locavores — “those who eat local foods, either mostly or exclusively” as being driven by a desire for “a feel-good attitude” are also too sweeping, and slightly hypocritical, in this reviewer’s opinion, given Cowen’s high praise for local foods in other countries.

An Economist Gets Lunch is recommended, like a good restaurant, with reservations.

© Reviewer: Carlton Brown & Ford Library – Fuqua School of Business.
All rights reserved.

Media Review: The China Study & Forks Over Knives

Monday, November 28th, 2011

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Campbell, T. Colin. The China study : the most comprehensive study of nutrition ever conducted and the startling implications for diet, weight loss and long-term health. BenBella Books, 2005.

Fulkerson, Lee (writer/director). Forks over knives. Monica Beach Media & Virgil Films. 2011.

At least once every month, I learn about a Fuqua faculty or staff member who has been diagnosed with cancer.  Many others are survivors – thanks to Duke Univ. Medical Center.  And any student who lives long enough runs the risk of this disease, which some people are calling an epidemic.

Staff member and cancer survivor Mia Ketchum recommended two resources for the Ford Library’s health management collection – the video Forks over Knives and the book, The China Study* by Dr. Colin and Thomas Campbell.

The book and the video cover the same topic — the connection between diet and chronic diseases, such as heart disease, diabetes,  and cancer.  They also review the work of scientists and conclude that a whole foods, plant based diet can prevent these diseases.  Furthermore, they provide evidence that this diet can repair damage to cells, reversing the course of disease and restoring one to full health.

In discussing the link between food and health, these scientists recommend that patients eat fruits, vegetables and whole grains, avoiding animal based foods including meat, fish, milk, cheese and eggs.  The ideal diet is a vegan diet, composed of whole unprocessed foods, based on plants.  The authors are convinced that scientific evidence about diet has been tainted by financial support for scientific research in nutrition made by the dairy and meat industries.

As a cross check, this reviewer contacted the nutritionist at Duke Radiation Oncology and discovered that Duke is also recommending that their patients eat more plants and fewer animal based foods, although they stop short of recommending a vegan regimen.

Not everyone will be motivated to adopt a vegan regimen, yet those interested in maintaining a healthy diet would find this book or video illuminating.

* The China Study is also available as an audiobook.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business.
All rights reserved.

Book Review: Selling the fountain of youth

Wednesday, October 27th, 2010

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Weintraub, Arlene. Selling the fountain of youth : how the anti-aging industry made a disease out of getting old, and made billions. Basic Books, 2010.

If taking hormones were dangerous, then all 20 year olds would have cancer. So goes one of the arguments made by promoters of anti-aging clinics in a new book by Bloomberg BusinessWeek science journalist, Arlene Weintraub. To turn back the clock, consumers in this industry devote their whole paychecks to treatments, and follow medical advice dispensed by Hollywood star Suzanne Somers. When their family MD’s balked about prescribing hormones that cause cancer, patients took their business to the new anti-aging clinics instead.

From its humble beginnings in the 1990’s to today’s $88 billion industry, author Weintraub takes the reader through the gamut of hopeful treatments, including injections with HGH and Botox, and the more natural dietary supplements, such as elixirs made from acai berries and resveratrol pills, distilled from red wine. She also discusses the battles between big pharmaceutical companies and independent compounding pharmacists, highlighting the problems in non-regulated drug products. She covers the lies and scams.

Weintraub states that anti-aging doctors are acting in good faith to help their patients. But she cautions that sometimes doctors are wrong. Anti-aging treatments have not been scientifically tested in double-blind studies. They may be ineffective or worse, causing harm to the patient. And now for the truly bad news – the only proven route to maintaining a youthful body involves exercise. Frequent workouts, while maintaining a healthy weight, is the only regimen that actually works to keep us young.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business.
All rights reserved.

Book Review: Priceless

Thursday, August 26th, 2010

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Poundstone, William. Priceless : the myth of fair value (and how to take advantage of it). Hill and Wang, 2010.

Years ago, a businessman asked me to recommend a good book on pricing, which is when I first realized that good books on pricing are hard to find. It turns out that more than just a number, price is dependent on context, and any given price can be viewed as a bargain or a rip-off depending upon how it is framed.

In Pricing, author Poundstone describes the psychology of pricing. In most of the book, he describes experiments by well-known a psychology researchers, including those of Fuqua faculty member Dan Ariely, whom he describes as a brilliant Israeli American. Poundstone describes a variety of pricing tricks, some of which are centuries old. He uses cases to illustrate the powerful effects of anchoring and adjustment. He also offers suggestions to use in price negotiations, for example, to threaten to walk away from the table rather than to agree to an unacceptable starting point.

A number of books on behavioral psychology have been reviewed in this blog including Nudge by Richard Thaler; How We Decide by Jonah Lehrer; Sway by Ori and Rom Brafman; and the Upside of Irrationality by Dan Ariely. All of these books, including Priceless, are informative and interesting reads. At the end of the day, however, it is probable that even those who have read these books will continue to find themselves manipulated by price. It turns out that even things that no one believes still influence our behavior.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business.
All rights reserved.

Book Review: Spent – Sex, Evolution, & consumer behavior

Thursday, August 12th, 2010

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Miller, Geoffrey. Spent : sex, evolution, and consumer behavior. Viking, 2009.

If a $1,200 high-quality replica of the Rolex President watch is difficult to distinguish from the $30,000 original, why do people pay the $28,000 premium for the real one? And why do Americans work long and hard for money to buy status products, when the pleasures they are bring are short-lived? Human evolution offers some answers.

In Spent, evolutionary psychologist Geoffrey Miller explains that humans evolved in small social groups in which image and status were important for attracting mates and rearing children. Modern humans possess the same instincts as those early social primates. People still advertise their ability to survive and reproduce, and unconsciously, they use status products to display their biological fitness to one another. The Rolex watch signals that the wearer is wealthy, intelligent and sexy, important traits in a mate.

Miller also discusses the engine of our consumer capitalism – marketing. Marketers use advertising to create psychological links between products and the traits that consumers want to display by hinting in vague terms the possible status and sexual payoffs for buying and displaying premium products.

This short review cannot do justice to the many ideas in this important work. The book is full of challenging insights, and numerous examples. The writing style is clear and entertaining. Miller concludes that by spending less time purchasing goods, humans would have more time to enjoy life and find suitable mates and friends.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business.
All rights reserved.

Book Review: The Upside of Irrationality

Tuesday, July 13th, 2010

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Ariely, Dan. The upside of irrationality : the unexpected benefits of defying logic at work and at home. Harper, 2010.

Fuqua faculty member Dan Ariely has written a second best-selling book about the biases that influence our behavior and answer the question – Why do we act the way we do?

As in his previous book, Predictably Irrational, Prof. Ariely describes experiments that illustrate basic principles of behavioral economics, such as adaptation and empathy. He discusses biases, such as the IKEA effect — why we overvalue what we make by hand – and the Not-Invented-Here bias – why we overvalue our own ideas. Readers learn how a sincere apology can reduce anger; how employees value meaningful work; and why large bonuses do not improve performance (hear that, Goldman Sachs?). People who are aware of their biases make better decisions.

The Upside of Irrationality is written in a conversational tone, peppered with charming and humorous stories about Ariely’s family and friends. Ariely also draws on his experiences as a burn patient to explain his outlook on life. A personal story and an engrossing read, the book feels like a long discussion over dinner. Upside is one of the best books of the year.

The Upside of Irrationality is also available in Ford Library as an audiobook.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business.
All rights reserved.

Book Review: Busted: life inside the great mortgage meltdown

Tuesday, March 30th, 2010

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Andrews, Edmund L. Busted : life inside the great mortgage meltdown. W. W. Norton, 2009.

Busted is a personal and penetrating account of one man’s experience with purchasing an overpriced house with a subprime mortgage. Written by an economics reporter for the New York Times, the author is aware of the economic and financial risks, yet he succumbs to temptation and buys a house he cannot afford. With his judgment impaired by his emotions – he is in love – Andrews enters into a vortex of debt from credit cards and desperate refinancing on his home.

Andrews ends up ruined financially. He claims responsibility, but he also blames the mortgage brokers and real estate appraisers, money lenders and Wall Street players, credit rating agencies, institutional investors and Washington policymakers. Eventually he blames his ex-wife. One person he does not blame is his new wife. The Atlantic later reported that he failed to disclose Andrews’s new wife’s history of bankruptcy.

This is not a book with a happy ending. Yet this blunt tale of personal ruin is riveting and well worth the investment in time.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business.
All rights reserved.

Book Reviews: “Cheap” and “Free”

Wednesday, December 2nd, 2009

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Shell, Ellen Ruppel. Cheap : the high cost of discount culture. Penguin, 2009.

Anderson, Chris. Free : the future of a radical price. Hyperion, 2009.

An outlet mall in Philadephia rings in four times as many visitors as the Liberty Bell. Colonial Williamsburg can’t hold a candle to the Potomac Mill outlet mall. So writes author Ellen Ruppel Shell in the book Cheap. Outlet malls are located 25 to 100 miles from a metropolitan area as a deliberate strategy. Not only is the land inexpensive, but the inconvenient location connotes cheap and America has a love affair with cheap.

Ruppel Shell covers a wide range of topics, including the history of bargains and markdowns, the effects of discounting on durability and craftsmanship and the psychology of discount decision making for the shopper. The hunt for bargain prices has led to a host of problems, including an unsafe food supply, global poverty and environmental devastation. Consumers have paid a high price for cheap goods.

So how low could prices go? In Free, author Chris Anderson makes the case that in an online economy, the cost of distribution is driving toward zero. Businesses have become more profitable by giving things away than they can by charging for them. (more…)

Book Review: Longing & Belonging

Thursday, August 6th, 2009

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Pugh, Allison J. Longing and belonging : parents, children, and consumer culture. University of California Press, 2009.

In affluent and low-income families alike, spending on children has exploded. Some of the blame belongs to advertising, a powerful factor in ramping up children’s desires and parents’ spending practices. Some of the blame belongs to the costliness of childhood toys, such as a $300 Nintendo, $90 American Girl doll or $165 for a pair of Air Jordans.

In Longing and Belonging: Parents, Children and Consumer Culture, Sociology professor Allison Pugh provides an in-depth analysis of a third reason parents spend for their children. Children want to belong to a group and conversations at school and in the neighborhood are about materials goods. Children yearn to join these conversations, and their parents don’t want them to be left out.

Poor families buy expensive children’s goods at great financial sacrifice. Affluent parents can afford them but feel guilty for selling out to the commercial culture. All parents wish to prevent their children from feeling invisible with their peers. Anyone wishing to opt out finds it very difficult.

In the end, this is a book about consumer culture and how parents use material goods to help construct happy childhoods for their children.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business.

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Book Review: Shopping for Jesus

Monday, March 16th, 2009

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Janes, Dominic. Ed. Shopping for Jesus : faith in marketing in the USA. New Academia Publishing, 2008.

There is a thin line between attraction and revulsion. It is like cleaning the refrigerator and finding food of unknown vintage. Despite knowing it is spoiled, there is a compelling urge to open the container and take a sniff before throwing it in the trash.

When I saw this book on the display shelves in the marketing area of the Ford Library, I noticed the crucified Jesus on the cover, his outstretched hands nailed to the cross, clutching shopping bags filled with consumer goods. I was repulsed by the cover, yet I could not resist the urge to open it up and sniff the contents.

What I found surprised me. Shopping for Jesus is a collection of thoughtful essays about the boundary between religion and business. It explores the connections between belief, its presentation and the processes by which it is sold and consumed. Each chapter presents an independent case study.