The Free Market
The Myth of "Planned Obsolescence"
The Free Market 26, no. 2 (February 2005)
John Kenneth Galbraith, that insufferable puritan, wrote an odd book in 1958 called The Affluent Society, and it had a huge influence on several generations of anti-market activists. The burden of the book was to brazenly shift the terms of the debate over socialism and capitalism. Whereas the socialists once argued that capitalism produced too little, they would now follow Galbraith to say that capitalism produces way too much of the wrong sort of thing (things to consume) and too little of the right sort of thing (public goods, equality, etc.).
One of the many targets in the book was so-called "planned obsolescence" — the practice of manufacturers to design their products to wear out and break down at a certain point in the future. This would thereby cause consumers to have to go out and buy a new and very similar item. These clever manufacturers would couple this planned obsolescence with a cosmetic change masquerading as an improvement to fool the consumer into thinking that he got his money’s worth, when in fact he was really being ripped off, paying twice for what should have only been bought once.
There are bogus assumptions here. First, the model assumes that the manufacturers are far more clever than consumers, who are treated as some sort of passive victims of powerful capitalist interests. In fact, in the real world, it is the manufacturers who are clamoring to keep up with the ever-changing, discriminating, cheap, and fussy consumers, who dump products and switch others for reasons rational and mysterious.
Second, the model makes an odd normative assumption that products should last as long as possible. In fact, there is no preordained market preference for how long goods should last. This is a feature of manufacturing entirely driven by consumer demand.
The old Galbraithian canards are back again, as many commentators have noted that kitchen appliances, and many other things, just don’t seem to last the way they used to. In the old days, you got a blender as a wedding gift and your daughter would use it when she came home from college. These days we are lucky if a blender or hand mixer lasts a few years. The same seems true of washers and dryers, lawn mowers and edgers, clothing, electronic equipment, and even homes. Nothing lasts like it used to.
But is this a case against the market or merely a reflection of consumer preference for values (lower price, the newest technology, and different amenities) other than longevity? The latter, I submit. As materials have fallen in price, it makes more sense to replace the good than to create it to last forever. Do you want a $200 blender that last 30 years or a $10 blender that lasts five years? Whatever consumers prefer in the long run is what dominates the market.
How can we be sure? Competition. Let’s say all manufacturers make blenders that die in 5 years only, and this fact is widely loathed. One manufacturer could beat the competition by providing a product that emphasizes longevity over other features. If consumers really value longevity they will be willing to pay the difference. The same logic applies to cars, computers, houses, and everything else. We can know what preference dominates (in a free market) by simply looking at what practice is most common in the market.
Imagine if a computer manufacturer produced a machine that was advertised as a lifetime computer, the last computer you will need as long as you live, complete with software that will similarly last forever. Anyone with savvy would be skeptical, realizing that this is the last thing you want. Ideally your computer should only last as long as you want it to last before you are ready to upgrade to a new model. Far from being a rip-off, then, obsolescence is a sign of rising prosperity.
In times of massive and frequent technological improvement, it would be sheer waste for manufacturers to dump resources into making products last past their usefulness. In computers, for example, to have made them durable enough to last more than 6 years would be a big mistake in today’s environment. The same could be true of houses too. Everyone knows that old houses can be charming but bears to grapple with in terms of heating, cooling, plumbing, wiring, and everything else. The efficient solution might well be to level a house and rebuild rather than attempt an upgrade.
This would only be a waste if you push longevity ahead of technological improvement. Individual consumers are free to do that, but we have no basis for declaring this value set as fixed and unchanging. We do not live, nor do we wish to live, in a world that is static, where development never occurs, where what exists has always existed and always will.
So it is with clothing and furniture and other goods. As people have more disposable income and it rises over time, people want to be able to replace what they wear to accord with changing tastes. A society in which clothes are forever mended, electronic parts are forever fixed, and existing products are forever bucked up to go another mile is not necessarily a rich society. To be able to toss out the broken and torn is a sign of rising wealth.
It is common for people to look at a hollow door or a composite-wood desk and say: what cheap and shoddy products these are! In the old days, craftsmen cared about the quality of what they made! Now no one cares and we end up being surrounded by junk! Well, the truth is that what we call high quality from the past was not available to the masses to the same extent it is today. Homes and cars might have lasted longer in the past but far fewer people owned them than in today’s world, and they were far more expensive (in real terms).
In a market economy, what is called quality is subject to change according to the preferences of the consuming public. Whether products should last a lifetime (such as wedding rings) or a day (fresh bread) cannot be determined outside the framework of a market economy. No central planner can say for sure. It is constantly subject to change.
If your book falls apart, your clothes collapse in tatters, and your washing machine suddenly keels over, resist the temptation to decry the decline of civilization. Remember that you can replace all these items at a fraction of the price that your mom or hers bought them. And you can do so with minimal fuss and trouble. And it is very likely that the new versions of the old products that you buy will have more bells and whistles than the old.
You can call this planned obsolescence if you want to. It is planned by producers because consumers prefer improvement to permanence, availability to longevity, replaceability to reparability, motion and change to durability. It is not waste because there is no eternal standard by which we can measure and assess the economic rationality behind the use of resources in society. This is something that can only be determined and judged by individuals using resources in a market setting.
Of course a person is free to live in a drafty stone house, listen to music on a Victrola, wash clothes with a washboard, tell time with a sundial, and make one’s clothes from flour sacks. Even now this is possible. One is free to be completely obsolete. But let us not equate this status with wealth, and let us not aspire to live in a society in which everyone is forced to prefer the permanent things to the improving things.
[Originally published under the title "How Long Should Things Last?"]
Cite This Article
Rockwell, Llewellyn H. "How Long Should Things Last?" The Free Market 26, no. 2 (February 2005).