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Tag Archives: economic indicators

EyelidCosmeticSurgery

GDP, move over. Thanks to our nation’s obsession with physical beauty, there’s a new way to check the vitality of our economy. How? By looking at the number of cosmetic surgeries done annually. It makes sense that this would be a pretty accurate indicator—during times of economic depression, fewer people spend money on superfluous luxuries such as plastic surgery. And according to statistics from the ASPS (American Society of Plastic Surgeons), good economic times are ahead of us as the number of plastic surgeries went up by 5% to 14.6 million in 2012.

But let’s take a deeper look inside these statistics.

The growth of this number is not coming from an increase in invasive procedures such as breast augmentation, eyelid surgery, facelift, liposuction, or nose reshaping. Instead, the change has come from increasing popularity of cheaper procedures like Botox, chemical peeling, and laser hair removal. In fact, two of the more expensive procedures, (nose jobs and eyelid surgeries) were actually more popular in 2010, a time when many people were just starting to recover from the recession. Perhaps this interest in cheaper surgeries could indicate that Americans are still not up for splurges quite yet.

All of these surgeries’ popularity has varied throughout the past few years, but there is one procedure that is the reigning queen of them all: breast implants. In the past 15 years, the number of breast augmentations has tripled (recession and all).

Fun fact: Although the majority of these procedures are done purely based on our society’s obsession with big breasts, there is one redeeming justification that is getting more and more popular each year. It is becoming increasingly common for breast cancer survivors to go through reconstructive surgeries after mastectomies. Although reconstruction only makes up a fraction of all breast implants, it’s nice to know that America’s infatuation with bodily enhancement has helped bring about a solution to a problem many cancer survivors were previously faced with.

Sources and Resources: For more information about the growing trend of reconstructive surgery for cancer patients, read this Slate blog post. This article gives information about how the overall increase in plastic surgery is affecting our economy. This article by Time Magazine provides more economic analysis of the plastic surgery business.

From Guest Blogger, Kent Place Student Lilli DeBode

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The lipstick effect has become the nail polish effect.

People love to cite the lipstick effect. Named in 2001 by former Estée Lauder CEO Leonard Lauder, the lipstick effect just says that during hard times women enjoy more inexpensive luxuries like lipstick.

But looking at this graph from The Economist, you can see that the lipstick effect does not consistently correlate to good and bad times.

The  Lipstick Effect was not evident during the 2008 recession.

Still though, Mr. Lauder says the effect is really about less expensive luxuries that buoy people during hard times. For recession year 2008, with sales skyrocketing, perhaps nail polish is the new lipstick.

In addition to lipstick and nail polish, for the following 2008 recession indicators, I have don’t have sufficient data, but don’t they make sense?

  • diaper rash cream sales up
  • disposable diaper sales down
  • divorce rates down
  • more adult children moving in with parents
  • rising food truck sales
  • architects billing less
  • men’s underwear sales down (MUI)

Our Bottom Line: Like a rubber band, our spending can be somewhat elastic. During prosperity, for certain goods and services, our spending stretches a lot. Then though, for those same items, when recession hits, we buy much less. Called the income elasticity of demand, when we have noticeable changes in the quantity that we demand because our income drops, our buying behavior creates a recession indicator.

 

Sources and Resources: For lipstick effect and source of graph, here; diaper rash data, here; architecture, here; boomerang generation, here; less divorce, here; food truck sales, here; men’s underwear index, here.

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Palm Tree

By Mira Korber, guest blogger.

Just last week, a desperate pit-stop at the iconic southern restaurant chain, Waffle House, proved the very worst of my life’s infrequent fast-food exploits. Mid 1,300 mile road-trip, the black letters on yellow signage hailed the only game in town open after 10pm, so — being a northerner myself — I decided to see what this waffle thing was all about. At any rate, my “T-bone steak with eggs” was more steak tartar with yellow and white goop, but I promise not to disintegrate any further into my anti-Waffle House tirade, because the company’s economic relevance is far more interesting.

Apparently, the Wall Street Journal’s “Waffle-House Index” is a term referring to (non-gastronomic) natural disasters. With over 1,600 locations in the South, people have come to rely on the status of their nearby Waffle House to measure the severity of weather crises. The company’s trademark is its 24-hour operation, so when locals see a closed restaurant, they know things are pretty bad. The official Waffle-House Index is conveniently color-coded to signify just how problematic a disaster may be.

The shining beacon of 24 hour goodness since 1955, Waffle House ranks among the best disaster recipes and disaster indicators. Why, it’s even a great venue for disaster to strike. Read this excellent NY Times article about a recent string of shootings at Georgia Waffle Houses. A loyal customer even says she’ll keep returning to Waffle House even though there might be the minor risk of gunpoint robbery.

And, perhaps needless to say, this article is not mentioned on the “In the News” page on the Waffle House site.

The Economic Lesson

A true port-in-the-storm, Waffle House competes through its dependable image. To differentiate itself from other fast-food and low-end restaurant competitors, Waffle House allows you, the ravenous customer, to chow down anytime hunger strikes. Regardless of its food quality or crime rates, it’s open, reliable, and will feed your grumbling stomach.  24/7, stop in to Waffle House for a bite, which is more than you can say for a neighboring Olive Garden or Arby’s.

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