There is a tremendous amount to admire about Japanese culture. But the personal spending habits that frugal Japanese homemakers have employed to combat economic stagnation and deflation are not among them. Yet these tactics may be suggestive of what the rest of the world should plan for in a prolonged downturn. If you want to get depressed about consumer spending in general, a good place to start is this New York Times article from earlier in the week. Setting a dark stage, the authors note that "the economic malaise that plagued Japan from the 1990s until the early 2000s brought stunted wages and depressed stock prices, turning free-spending consumers into misers and making them dead weight on Japan's economy ... Today, years after the recovery, even well-off Japanese households use old bath water to do laundry, a popular way to save on utility bills."
One relatively well-off family in suburban Tokyo, the story notes, "carefully rations vegetables" and reverts to cabbage stew to save money. Another consumer shares her secrets to saving even more while shopping and is quoted as saying "I'm going to find a bargain, then wait until it gets even cheaper," in discussing her particular tactics. While there might be some abstract lessons here for corporate Spend Management, I find the overall story depressing from the perspective that when consumers stop spending in general, feeling guilty about even buying carrots at the grocery store, it is virtually impossible for an economy to climb out of a sustained downturn at anything but a snail's pace.
- Jason Busch