Inferior Industry
Published by Sushi on Friday, March 14, 2008 at 4:50 AM.
I'm coining a new term: Inferior Industry.
The New York Times ran an article today describing the booming debt collection industry:
As the economy slips into recession and unemployment rises, more people default on their loans and create new jobs for debt collectors. If you're looking for a career change or new opportunities, this might be a good industry, at least in the near future.
Inferior goods are goods that decrease in demand when consumer income increases. The text book example is long range bus travel (i.e. Greyhound): as people's income increases, they choose to fly (quicker and costlier), hence decreasing the demand for bus travel. Other examples are fast food, frozen dinners, and instant ramen (when did you eat the most instant ramen? college? case in point).
Inferior industries, as I define it, are industries that hire more people when the economy as a whole is declining. The debt collecting industry is a perfect example of this. In Japan, during the late 90s recession, the Pachinko (legalized form of gambling) industry soared, opening parlors everywhere.
I wonder if economists have studied employment across different industries during various economic climates. This would be nice information for those sick and tired of getting fired at every economic downturn. The best bet, however, might be to get a job that is completely independent of the economy, like a university professor.
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The New York Times ran an article today describing the booming debt collection industry:
So many people are in so much debt that the government says bill collecting is one of the fastest-growing businesses. By 2016, employment in it is projected to exceed half a million workers, up 23 percent in a decade.
Inferior goods are goods that decrease in demand when consumer income increases. The text book example is long range bus travel (i.e. Greyhound): as people's income increases, they choose to fly (quicker and costlier), hence decreasing the demand for bus travel. Other examples are fast food, frozen dinners, and instant ramen (when did you eat the most instant ramen? college? case in point).
Inferior industries, as I define it, are industries that hire more people when the economy as a whole is declining. The debt collecting industry is a perfect example of this. In Japan, during the late 90s recession, the Pachinko (legalized form of gambling) industry soared, opening parlors everywhere.
I wonder if economists have studied employment across different industries during various economic climates. This would be nice information for those sick and tired of getting fired at every economic downturn. The best bet, however, might be to get a job that is completely independent of the economy, like a university professor.
Labels: economics
