The countercyclical asset? (a continuing series)

by on June 27, 2012 at 2:46 pm in Economics, Games | Permalink

Highly speculative, but fun to think about:

Four separate experiments, along with real-world data, all say yes. Our findings consistently supported the lipstick effect, as college-age women, when primed with news of economic instability, reported an increased desire to buy attractiveness-enhancing goods, along with a decreased desire to purchase goods that do not enhance one’s physical appearance. Our experiments also found that this increased desire for beauty products, clothing and accessories was fully mediated by a heightened preference for mates with resources.

While many journalists who have written about the lipstick effect have theorized that it represents women’s therapeutic spending on cheap indulgences, we found that the lipstick effect applies specifically to products that enhance beauty, even when those products are more expensive. Recession cues increased women’s desire to buy high-end cosmetics and designer clothing, but not to buy budget-line beauty products, which were rated less effective at improving one’s appearance.

Furthermore, we discovered that the lipstick effect and a woman’s desire to attract a mate with resources are unrelated to her independent resource access. Women of both higher and lower socioeconomic status expressed an increased desire to buy luxury beauty products when primed with recession cues. This suggests that an uncertain economic climate leads women to heighten mate attraction effort irrespective of their own resource need.

The story is here, and I thank VS for the pointer.

1 margda June 27, 2012 at 2:59 pm

so there is no true love!? only mate attraction.

2 Miley Cyrax June 27, 2012 at 3:06 pm

What sexist hogwashery. How dare anyone suggest the main driver of female attractiveness is looks? This research is just as preposterous as the notion that men tend to go to restaurants with beautiful women, as restaurant reviewer/misogynist Cowen has suggested. Whatever beautiful means, as beauty is purely a cultural conspiracy to keep women down.

3 derek June 27, 2012 at 8:17 pm

I’ve been watching the interesting habits snd strategies of birds around my home. It is the males who are more striking in appearance, more colorful. The females are often nondescript.

Another cultural phenomena that is about keeping women down.

4 Dano June 27, 2012 at 3:29 pm

Our findings consistently supported the lipstick effect, as college-age women, when primed with news of economic instability, reported an increased desire to buy attractiveness-enhancing goods, along with a decreased desire to purchase goods that do not enhance one’s physical appearance.

This contradicts the hemline indicator for stock market indices (as the hemline rises, so does the market). One explanation for the spurious correlation is that in times of higher economic uncertainty hemlines get longer because people are more risk averse.

5 dirk June 27, 2012 at 3:47 pm

Perhaps high hemlines signal increased sluttyness, which increases when times are good and there are more attractive men about, whereas buying lipstick and designer clothing is more about attracting that one good man at times when good men are scarce.

6 Thor June 27, 2012 at 6:51 pm

I have it on good authority that good men are always scarce.

7 Robert Olson June 27, 2012 at 10:11 pm

Doesn’t necessarily contradict it. Some/Many/Most/chooseyourqualifier men are not going to commit to a woman perceived as sexually loose and higher hemlines might be perceived as loose.

8 Joe June 27, 2012 at 3:34 pm

Stop the presses!!!

So you are trying to tell me that chick dig clothes, make up, and guys with money?

You are also trying to tell me that women still want a guy with money even if they also have money?

And to top it all off you are trying to tell me in times of econic hardship, those that have more resources are better off and have have certain advantages like being higher demand by women?

I think you are crazy. Now, if you will excuse me, I am going to get me some free healthcare.

9 Neha June 27, 2012 at 4:05 pm

Since when are college-aged women (18-22) actively looking for husbands?

Why can’t college aged women want to look good in times of economic uncertainty to bolster their own careers and ensure their own success?

10 lords of lies June 27, 2012 at 4:09 pm

“Why can’t college aged women want to look good in times of economic uncertainty to bolster their own careers and ensure their own success?”

so you’re admitting beauty is important to a woman’s economic success? women may be vamping it up for the mating attention of resource-rich men, or the employing attention of hiring managers. either way, it doesn’t look good for prestige feminism.

11 Millian June 27, 2012 at 5:16 pm

I guess we could test the result further by replicating the experiment in a society in which women control the large majority of economic resources and allocation decisions, but it’s more fun to say that feminism sucks.

12 Neha June 27, 2012 at 5:17 pm

i’m saying that women want to look good, to feel good, to be more confident in the workplace.

13 rick June 27, 2012 at 10:17 pm

So you are saying that handsomeness, grooming, and general physical attractiveness is not important to male success?

14 Miley Cyrax June 27, 2012 at 10:34 pm

Physical appearance is a smaller component of male attractiveness to women than is female attractiveness to men.

Thanks for building the strawman though. Fastball down the middle.

15 Doug June 28, 2012 at 2:58 pm

“Physical appearance is a smaller component of male attractiveness to women than is female attractiveness to men.”
Oh, I don’t know about that one. I think its probably more accurate to say that women are more willing to be in relationships with men they aren’t very attracted to. If you want to know who women are actually attracted to, look at who they have casual sex with, not who they marry.

16 anon June 27, 2012 at 10:40 pm

Men and women alike are under pressure to make a good first impression, including a good physical impression. Sure the standards may differ, but accepting that looks have some effect is not a death blow to feminism.

Oh and I think of wearing lipstick as being put together and not vamping it up…the idea that people seek out relationships/social in tough economic times is not that hard to entertain. I would guess there’s some equivalent for men to the lipstick index.

17 GiT June 28, 2012 at 1:56 am

Feminists ‘admit’ that beauty is important to women’s economic success. They also ‘admit,’ obviously, per logical consequence, that conforming to beauty standards helps some women to be successful. That fact is an object of study and critique among feminists. It’s mysterious why you think it has any sort of meaningful impact on feminism (or whatever the hell you think “prestige feminism” is).

18 celestus June 27, 2012 at 4:20 pm

“Since when are college-aged women (18-22) actively looking for husbands?”

They are, unconsciously. College-aged men aren’t actively looking for wives but still prefer a good waist-hip ratio.

19 Millian June 27, 2012 at 5:15 pm

A hypothesis about unconscious urges towards years-hence mating makes less sense, and is more complicated, than the fact that make-up gets you through job interviews.

20 dirk June 27, 2012 at 5:40 pm

A hypothesis that prime mating age women are buying makeup in order to… attract mates is not complicated.

21 Millian June 27, 2012 at 5:48 pm

No, I don’t think that is complicated. However, a hypothesis about their doing so for economic reasons more frequently during the negative part of a business cycle, when any financial gain would come long after the business cycle, is… more complicated, and better-explained by the economic gains from being attractive that you get right now.

22 dirk June 27, 2012 at 6:02 pm

I think the hypothesis behind a financial downturn suddenly affecting a mating strategy is that many men lose their self-esteem during a market downturn and thus become less desirable. So as desirable men become scarcer, women amp up their attraction game. I don’t think anyone (yet) has suggested that the women are thinking in terms of the financial security that such a mate would provide them.

23 celestus June 27, 2012 at 6:36 pm

I could see some of it being more competitive labor market -> you want to look better, but isn’t it a trope that when times are bad men get their hair cut less often, use a cheaper razor, and buy suits from Men’s Wearhouse? Is that perception incorrect, or are men doing it wrong?

24 Pshrnk June 28, 2012 at 2:06 pm

Ummm and why is it that make up gets you through job interviews?

25 Bill June 27, 2012 at 4:18 pm

I once conducted a study to find counter-cyclical companies. I only found one genuinely counter-cyclical industry: Bible publishers

26 Mark Thorson June 27, 2012 at 6:38 pm

Take a look at dietary supplements and other forms of quack medicine. The theoretical explanation is that when people lose their health coverage they turn to cheaper substitutes (whether or not they actually work).

27 chuck martel June 27, 2012 at 8:45 pm

“Quack medicine” is popular at all times and how are dietary supplements a variety of that genre? The history of medicine, even contemporary medicine, is one of quackery. See: http://nailheadtom.blogspot.com/2010/02/death.html

28 Mark Thorson June 27, 2012 at 10:37 pm

With the exception of vitamins and minerals at reasonable doses, most of the field of dietary supplements is a vast cesspool of quackery. That includes all of homeopathy, most herbals, most biochemicals, etc. There’s a few that really do what they promise, like melatonin for sleep, but most are just scams for the unwary. Dietary supplements are a multibillion dollar industry largely populated by charlatans and hucksters.

29 TallDave June 28, 2012 at 2:04 pm

Mostly true, but otoh if you look at the studies a few have pretty compelling evidence. Not that green tea extract is necessarily a good substitute for bypass surgery, mind you.

Also, chuck makes a great point — there’s really never been enough science in medicine. Look at how doctors have been telling people to eat; the emphasis on more carbs and less fat lead to an epidemic of diabetes and heart disease, and it’s only very recently that even daily multivitamins were accepted by the AMA.

30 Peter June 27, 2012 at 4:45 pm

It would be really nice if one side effect of economic uncertainty is that adult women actually start looking like adult women once again. Of course we’re more likely to see the sun rise in the west 🙁

31 EM DC ECONOMIST June 27, 2012 at 6:14 pm

Amen.

32 Miley Cyrax June 27, 2012 at 10:42 pm

Yeah what’s up with men preferring girls ages 16-25 or so? It’s almost like there’s an instinct to want to mate with fertile girls. Weird.

It would really be nice if men conformed to my rationalizations as to why I’m stuck with (an) aging middle-aged women/woman with no options.

33 TallDave June 28, 2012 at 2:07 pm

When models are morbidly obese, then we’ll be a truly evolved society. Hopefully I’ll be dead.

(BTW I think that’s why models are skinny, not because skinniness per se is innately desirable but rather because it functions as a proxy for adolescence.)

34 Bill June 27, 2012 at 4:48 pm

I wonder if condom consumption goes up as well, or if their sales are correlated with lipstick.

Correlation does not mean causation, of course.

35 Zachary June 28, 2012 at 12:24 am

+1 Well played!!

36 Silas Barta June 28, 2012 at 10:08 am

What about average lipstick smear on condoms?

37 gab June 27, 2012 at 5:34 pm

As the father of a “college-aged” woman, I can assure you that she (and other “college-aged women”) have very little knowledge of any “news of economic instability.”

Pretty much the only news they care about involves their classes, and more importantly, the next party…

38 Rick June 27, 2012 at 10:19 pm

Ditto

39 Zachary June 28, 2012 at 12:25 am

It’s not necessary that they know why they do the things that they do. Consequentialism.

40 josp June 27, 2012 at 6:39 pm

At times when I have been very ill and felt very ill – I go buy makeup, skin creams etc. Because it makes “me” feel better. It is a mental boost, not done for anyone else.

41 Miley Cyrax June 27, 2012 at 10:38 pm

At times when I feel hungry I buy food. Because it makes *me* feel better. It’s a mental boost, not for my instinctual need to survive.

To read between the lines, I’m making fun of your inability to realize that instinct oftentimes guides emotions.

42 Pshrnk June 28, 2012 at 2:13 pm

Are you not curious to know why it makes you feel better?

43 j June 27, 2012 at 7:44 pm

“Girls don’t like boys, girls like cars and money”

44 figleaf June 27, 2012 at 8:06 pm

It’s always so weird to me how much “research” is conducted on women’s ostensible mate-selection behavior. Compared to what pretty surely ought to be equally complex and interesting behavior by men.

Wonder if it’s got anything to do with the gender… and orientation… of most of the researchers.

Kind of a shame that Dirk (June 27, 2012 at 6:02 pm) has been the only one to speculate on the possibilities of more direct causes than changes in something as abstract as “economic uncertainty.” Which, presumably, actually does affect the entire population and not just the women in it.

It’s certainly the case that just as women think they have to be more “beautiful” than they actually do in order to be attractive to men, men think they have to be more “worthy” than they actually do. Where “worthy” can be measured in money, car or penis size, athletic or mental performance, and of course “status.” In proportion to their amount of both income and disposable income you’d think, you know, actual economists would be as interested in men’s “mating” behavior over changes of economic uncertainty as they are in women’s. But, again, seemingly not.

My guess is that, instead, people just assume men are “baseline normal,” whatever that means, and thus a priori both automatically solved and uninteresting. Whereas women are assumed to be “other” and thus a priori in need of perpetual scrutiny. I’m also guessing both assumptions are big mistakes to understanding… well… anything about what humans actually do.

figleaf

45 Jody June 28, 2012 at 2:33 am

<i<Compared to what pretty surely ought to be equally complex and interesting behavior by men.

Male mate selection process: Is she willing?

Some suggest “Is she human?” is also part of the process, but the West Virginia data casts sufficient doubt that more research is needed.

Now the male provider process is indeed much more complex as “coyote ugly” illustrates (mating is a given, hanging around is not).

46 YetanotherTom June 28, 2012 at 12:00 am

I suspect women’s mating behavior is studied more because it is widely believed that women have more power in choosing when and with whom to mate. If economics is the study of human action with an emphasis on scarcity, a woman’s sexual consent is of more economic interest than mens.
Anecdotally, yes I can confirm that girls I approached as I graduated in 09 were abnormally interested (and blunt) about my earning potential. I don’t remember much about cosmetics. I do know that, within reason, I don’t judge them. It’s not like I was approaching unfeminine girls as long as they didn’t care about money. I approached girls to whom I was physically attracted. That’s life.

47 YetAnotherTom June 28, 2012 at 12:11 am
48 bbb June 28, 2012 at 6:18 am

Are people more risk-averse, conservative and moralists during bad times?
When resources are abundant, females may have sex more freely. When resources are scarce, females have to be conservatives, get a resource-rich man first before having sex?

That would explain why women tend to look more naughty during good times (short hemlines) and prefer more strongly resource-rich men during bad times. The latter would lead to more competition of such men, which would explain the rest. The general moralism effect etc. would strengthen the hemline effect etc.

49 John Mansfield June 28, 2012 at 8:43 am

The place I work is an old naval facility that over the decades has become surrounded by an affluent inner suburb (Potomac, Maryland). As I drive into it from my outer suburb home, I see the men in their suits and nice new cars driving off to their offices in the city and the women jogging through the streets, and I think, how nice that each is doing his or her part to maintain the qualities they brought into the marriage, be it financial or physical attractiveness

50 Silas Barta June 28, 2012 at 10:07 am

Doesn’t this directly contract the earlier result that, in times of economic hardship, men prefer women with more functional bodies?

(Don’t have the cite but it should be easy to find — they found that the “curviness” of Playboy Playmates got larger when the economy worsened and vice versa.)

51 Patricia Mathews June 28, 2012 at 10:30 am

I say and say again … lipstick, hairdos, and other beauty enhancements ,,, especially those a bit more upscale than the woman wearing them.. are not “vanity”. They provide a major competitive advantage to the woman.

I repeat – they provide a major competitive advantage to the woman wearing them. Not just in catching a sugar daddy, but in the workplace as well.

Women who have not been blinded by the “vanity of the little darlings” nonsense put out since Adam know this, and any woman who has tried to find work without using them (an excellent Las Vegas card dealer was actually fired for the same, and the courts upheld her bosses) gets hit right in the face with it.

Do an economic analysis of why Madam C.J. Walker became so rich in her day **Without** postulating the vanity of the little dears — I mean, hard-headed economic analysis of the economic advantages to her customers of what they were buying — and we’ll talk about why the woman singing the Saint Louis Blues lost her boyfriend to “powder and store-bought hair.”

Sheesh. You boys should really have a woman addressing this issue. A woman economist who is honest enough to know why her dressing table and wardrobe are of such importance.

52 Pshrnk June 28, 2012 at 2:17 pm

And all you need to get that job at Hooter’s is an ornithology PhD from a top 5 program

53 Careless June 28, 2012 at 9:39 pm

Do you not realize this, on its own, has nothing to do with the post? You’re either right or wrong, and either way your hypothesis suggests women should not change their habits in response to economic conditions

54 SD July 1, 2012 at 3:17 pm

Thank you!

Makeup would be a luxury or a vanity if **baseline expectations for attractiveness in women** didn’t include the routine use of beauty products. Higher-quality products often have more subtle effects.

The other thing you see in a recession is a return to smart dressing; we’re not going back to the exercise-clothes-as-office-clothes styles of the 90s anytime soon.

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