Table of Contents
Consumerism is both an economic theory and cultural phenomenon that typically flourishes in a capitalist society. The theory of consumerism states that increased consumption of goods and services by the population will improve the economy. The people in this society, in turn, believe they must consume more goods and services to achieve happiness, fulfillment, and wellbeing.
In this article, you’ll learn more about the history of consumerism, its pros and cons, and how to manage it in your life.
Key Points
• Consumerism is an economic and cultural trend that can boost economic growth but also lead to personal debt and health issues.
• It originated in the early 20th century and expanded rapidly after World War II.
• Consumerism supports job creation and innovation, especially in technology and healthcare.
• Consumerism can contribute to environmental problems, such as increased emissions and habitat loss.
• Managing consumerism can involve budgeting and adopting minimalism to reduce unnecessary spending.
Consumerism Definition
What is consumerism? Consumerism refers to the economic theory that consumer spending on goods and services is crucial to bolstering the economy. It also refers to the cultural phenomenon that has happened in capitalist societies as a result. Specifically, it describes individuals’ feeling that they must partake of goods and services to be happy, often spending more money than they can afford on things that they don’t really need.
History of Consumerism
While many point to the post-World War II era as the beginning of U.S. consumerism, historian William Leach believes it dates back a little further to the turn of the century. In his 1993 book, Land of Desire, Leach argues that this time period marked a surge in department stores, assembly lines, investment bankers, and mail-order catalogs — all of which were early hallmarks of a consumer society.
As businesses headed into the 1920s, their production prowess was unprecedentedly strong — but American consumers were not yet used to the idea of, well, consuming. Economists realized that they needed to persuade consumers (“through advertising and propaganda,” as author Edward Bernays once wrote) that they needed more.
In short, businesses could manufacture plenty of supplies; now they needed to manufacture demand for the items that were being pumped out.
While the Great Depression slowed down the progress of consumerism, the effects of World War II and the rise of mass media fueled consumerism in the decades that followed. By this time, economists agreed that excessive consumption was the best way to improve the economy.
This belief is evidenced by this telling quote from retail analyst Victor Lebow in 1955: “Our enormously productive economy demands that we make consumption our way of life, that we convert the buying and use of goods into rituals, that we seek our spiritual satisfaction, our ego satisfaction, in consumption … We need things consumed, burned up, replaced, and discarded at an ever-accelerating rate.”
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Examples of Consumerism
You can find many examples of consumerism in today’s society, including:
• Huge shopping sales like Black Friday and Cyber Monday.
• Ads on TV, websites, and social media that encourage you to buy a new product or subscribe to a new service.
• Holidays built around gift-giving and consuming candy or food.
• New cars, phones, and other innovative tech being released every year — sometimes with upgrades more than once a year.
• Services, like streaming platforms and video game systems, built around a subscription model where you must pay every month to retain access to the service.
Recommended: How to Improve Your Money Mindset
Pros and Cons of Consumerism
Consumerism can offer both advantages and disadvantages to society:
| Pros | Cons |
|---|---|
| Boosts the economy | Can cause anxiety and unhappiness |
| Creates jobs | Can lead to debt |
| Creates a connected global society | Can create environmental problems |
| Encourages creativity, innovation, and better products | Can lead to poor physical health |
| Enables entrepreneurship and self-employment | May contend with spiritual or religious beliefs |
Read on to consider these pros and cons of consumerism in more depth.
Consumerism Pros
Consumerism can bestow a number of benefits to a society, such as:
• Improved economy: The primary tenet of consumerism is that individual spending will drive economic growth. While history has taught us that this is generally true, many opponents may ask, “At what cost?”
• Job creation: The more that a society spends on goods and services, the more that businesses need to hire people to create those goods and services. And it’s not just a phenomenon that impacts the U.S. Because America relies on raw materials from other parts of the world, consumerism typically creates jobs around the globe.
• Connected global society: Consumerism now happens on a global scale. America depends on other countries for products and services — and they in turn depend on us. While globalization is itself a nuanced topic, many believe that a more connected global society is a good thing.
• More creativity and innovation: Advocates of consumerism argue that it encourages and rewards creativity. When consumers vote with their dollars, companies are more likely to push the boundaries to deliver newer, better, safer products and services — and at lower prices. This can be especially important for medical advances.
• Entrepreneurship: In a consumerism-driven society, if you have an idea for a product or service that others want, you are free to pursue it. Launching your own business or working as a freelancer may mean that you can make money and take care of your family using your creativity and business acumen, as well as doing what you love to do.
Consumerism Cons
Outside of an improved economy, however, critics argue that consumerism can be bad for mental and physical health, as well as the environment. Downsides to consumerism may include:
• Anxiety and unhappiness: When people feel they always need newer, better things, they may never be satisfied. The pressure to have a new phone or car may lead them to work extra hours, unfairly compare themselves to others, and feel bad about themselves when they can’t afford the next best thing.
• Debt: Consumerism can motivate individuals to overspend on new things in an effort to achieve happiness. Unfortunately, many consumers spend more than they should on everything from cars and vacations to clothing and jewelry — and take on debt in the process. The average American household had approximately $10,767 in credit card debt as of July 2025, according to one study. This can also make it hard to save and build wealth.
Unmanageable debt can leave people without money in their bank accounts, it can destroy families, and it can also be detrimental to the entire economy, as the subprime mortgage crisis of 2008 demonstrated.
• Environmental impact: Producing, using, and throwing away goods can be harmful to the environment, with studies indicating that consumerism has a large part to play in global greenhouse gas emissions. Not only that, but as the human race grows and likely demands more and more things, the nonstop manufacturing of consumer goods could possibly harm or even destroy animal habitats.
• Poor physical health: Buying and consuming unhealthy foods, alcohol, and cigarettes can be detrimental to one’s health. But it’s not just what is consumed; as innovators introduce more technologies that make life easier — like robotic vacuums, gutter guards, and apps for grocery delivery — it’s easier for consumers to do less, leading to a more sedentary lifestyle.
• Spiritual and religious issues: Those whose spiritual or religious beliefs promote minimalism and charitable giving may find those beliefs at odds with the spirit of consumerism, which is about increasing your own wellbeing through the consumption of more goods.
Tips to Combat Consumerism
Consumerism can be a good thing: It creates jobs and bolsters the economy, and it allows opportunities for individuals to create new things. But when consumerism becomes excessive, it can damage an individual’s finances and possibly be harmful to their emotional and physical health.
Here are some ways you can be a more responsible consumer:
Creating a Budget
By creating a line-item budget that prioritizes the things you need, it’s easier to see how much money you can spend on the things you want. It’s unrealistic to think that you’ll completely stop buying goods and services that you enjoy.
Instead, through budgeting, you might gain a better understanding of how much you can afford to splurge without taking on debt or adding anxiety to your life. You’ll be better in touch with the money cycling through your checking account and landing in your savings.
By experimenting with different budget techniques, you can likely find one that suits you and helps you spend wisely and save for the future.
Recommended: 10 Most Common Budgeting Mistakes
Giving Things Away (or Selling Them!)
If your home currently has too much stuff, you might have been a victim to excess consumerism (including impulse buying) at some point.
Some people find it helpful to embrace minimalism. Try giving things away to those less fortunate, or have a garage sale to make some extra cash. Doing so may show you that you can be happy with less.
Thinking About What Really Makes You Happy
It’s easy to see what others have and think you need to buy it too. But is a new phone really going to make you happier? What’s wrong with the one you have? Understanding factors like lifestyle creep and FOMO spending, which can both be about keeping up with a lifestyle you see around you but is too expensive, can be worthwhile.
If you challenge yourself to define what happiness is for you, you may find that having new things isn’t a large part of the equation. In keeping this realization with you at all times, you can cut back on spending money on things you don’t need — and instead focus on the people, places, and hobbies that bring you happiness.
The Takeaway
Consumerism can be good for the economy: It’s probably created more jobs and opportunities for self-employment, and led to better-quality, safer products for a larger number of people. However, consumerism may also be responsible for negative impacts on our environment, physical health, and mental health. Consumerism is a nuanced topic with implications in nearly every aspect of life; it’s wise to be aware of how consumerism can affect you so that you can make smarter financial decisions.
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FAQ
What is a consumerism example?
There are several examples of consumerism in everyday life, including the seemingly constant release of new smartphone models, yearly mega sales on Black Friday and Cyber Monday, and the constant ads we’re exposed to on TV and the internet.
Is consumerism positive or negative?
Consumerism has pros and cons for society. While consumerism creates jobs, boosts the economy, and leads to better-quality goods and services, it can also lead to debt, anxiety, and even physical health issues. In addition, consumerism can help create a more connected world, but it can also have negative environmental impacts.
What is the simple definition of consumerism?
Consumerism is the economic theory that consumer spending on goods and services is key to driving the economy. To that end, businesses create new products and services to market to individuals. Individual consumers may feel like they need those new products and services to improve their wellbeing and happiness. While consumerism creates new jobs and bolsters the economy, critics believe that it can be harmful to our physical and mental health.
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