Obsolescence inevitable

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Marie-Pier Roberge

Tuesday, 1 August 2017 09:14

UPDATE
Tuesday, August 1, 2017 09:39

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A new is passed somewhat unnoticed at the beginning of July : the adoption by the european parliament of initiatives addressing the planned obsolescence (you know, this commercial strategy which aims to shorten the life of your consumer goods and make their repairs nearly impossible to get you to buy new ones). Some of the speakers have well reported the news (here and here), most often to express their doubts on the very existence of this phenomenon.

Yet, facts are stubborn. The shelf life of the products that surround us is in decline. Let’s try to understand why and what is at stake.

Conspiracy or business strategy?

The programmed obsolescence is not a conspiracy or a scheme. It is not in an office, somewhere at the top of a tower, a few bourgeois at the top of the form for deciding between them, the length of life of goods. This is a caricature, and if we want to understand what it is, it is more relevant to analyze what market mechanisms lead to the implementation of the planned obsolescence. It is in understanding what, in our economic organization, contributes to the development of this type of practice that we can then intervene. Let’s see how the whole orchestra.

Competition and market economy

The lack of competition in some industries, for example, can lead the companies within it to sell goods with a shorter life cycle. Is this what we call planned obsolescence, or is this merely a lack of competition?

We are often told that competition and free market go hand-in-hand. However, the planned obsolescence is a direct consequence of the freedom given to the companies. Because of the concentration trend implied in the rules of the game the capitalist, the last decades have been marked by a decline of competition that has led to a concentration of capital, and therefore, necessarily, by the formation of oligopolies and large conglomerates. They then lose the incentive to make goods that they produce more sustainable, even if the technology is available. Obsolescence is in this case a rational response to a problem of maximizing profits. Not surprising, then, that this stranglehold on the market is correlated with a degradation of the lifetime of the durable goods that we trade. The capital accumulates in the hands of fewer actors, who react rationally in not trying in any way to extend the life of your fridges!

In other words, the production decision of a firm is not a best response to consumer preferences, it is the result of a maximization problem of the sum of the profits achievable. The obsolescence and lack of competition are not two isolated questions. On the contrary, they are very intimately connected and, in analyzing them jointly, one can understand how the incentives leading to the practice of planned obsolescence are dependent on the structures of our economy.

Overproduction

Wages that are increasing at a slower rate than that of productivity reveal a growth of the offer which can not be overtaken by that of the application. Hence there is a tendency towards overproduction. The need to increase the rate of consumption becomes more and more blatant, not to respond to the needs of the people, but to allow companies to sell the goods they produce in surplus. This is where the marketing comes into play. Even if no technological improvement will have been added, we will be marketing a new model every year, taking care to differentiate it aesthetically from that of last year. The object still works as well after a year will soon look ancient to our eyes, and we will promptly replace it, even though it still fulfils all of its functions.

So, all of that does it is that the business response to a growing desire of consumers for lower prices? I couldn’t identify the moment at which humans began to prefer to provide less work in order to receive the same thing, but I would tend to think that it happened long before the lifetime of the appliances started to decline. Of course, the concentration of capital leaves the employees with resources dwindling, but the causes of the programmed obsolescence emanate from a system of a different scale.

It should be recognized that these are the incentives of the current economic system, which were used to spread the planned obsolescence. We can try to educate consumers on this subject, but this will unfortunately not enough to make a difference, because the phenomenon itself has emerged from forces beyond their single preferences. It should be clear steps, which can be used to repair them easily and to use our assets in a time horizon greater than that of the guarantee. No other force than that of a government intervention that goes beyond the awareness won’t happen to such results.