Recession 2008-2009: the Effect on Consumer Behavior and the Path to Recovery
Recession 2008-2009: The Effect on Consumer Behavior and the Path to Recovery
Submitted by:Tazrian Shainam Shahid (0511015)
School of Business
Independent University, Bangladesh
Chittagong
Abstract
The global financial crisis now underway is expected to have major impacts on North American and European consumers due to massive job losses and reductions in spending power. It will have even more serious consequences for people all over the world.
The financial crisis will undoubtedly reduce US and EU demand for at least some categories of apparel imports from the East as economic uncertainty (about job security, income, and savings) leads consumers to cut back on purchasing and brands and retailers to cut back on production in anticipation of shrinking consumer markets. It is common sense that as recession deepens and unemployment rises consumers would generally have less disposable income than before causing them to curb their spending. This will lead to a striking change in consumer purchase decisions and spending patterns and consumer behavior. With tightening pockets Consumers are likely to forego many goods and services, they are more likely to look for sharply-discounted products, which will favor some brands and retailers and not others.
This paper is an attempt to look in to the financial crisis not from the point of view of an economist but from the shoes of a consumer. It is an analysis of the effects of the financial crisis on Consumer behavior in the United States of America. This paper attempts to extend the established literature on the subject by analyzing the changes in the consumer behavior due to the current recession by analyzing the sales pattern in some key industries to reflect upon the changes in consumer purchase decisions during the recession. The paper will also reflects upon past recessions and also analyzes the different steps taken by President Barack Obama and his cabinet to
Submitted by:Tazrian Shainam Shahid (0511015)
School of Business
Independent University, Bangladesh
Chittagong
Abstract
The global financial crisis now underway is expected to have major impacts on North American and European consumers due to massive job losses and reductions in spending power. It will have even more serious consequences for people all over the world.
The financial crisis will undoubtedly reduce US and EU demand for at least some categories of apparel imports from the East as economic uncertainty (about job security, income, and savings) leads consumers to cut back on purchasing and brands and retailers to cut back on production in anticipation of shrinking consumer markets. It is common sense that as recession deepens and unemployment rises consumers would generally have less disposable income than before causing them to curb their spending. This will lead to a striking change in consumer purchase decisions and spending patterns and consumer behavior. With tightening pockets Consumers are likely to forego many goods and services, they are more likely to look for sharply-discounted products, which will favor some brands and retailers and not others.
This paper is an attempt to look in to the financial crisis not from the point of view of an economist but from the shoes of a consumer. It is an analysis of the effects of the financial crisis on Consumer behavior in the United States of America. This paper attempts to extend the established literature on the subject by analyzing the changes in the consumer behavior due to the current recession by analyzing the sales pattern in some key industries to reflect upon the changes in consumer purchase decisions during the recession. The paper will also reflects upon past recessions and also analyzes the different steps taken by President Barack Obama and his cabinet to
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