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Consumption and Exchange. Copyright © Allyn & Bacon 2002 What is an Economy? A system of production, distribution, and consumption of resources, including.

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Presentation on theme: "Consumption and Exchange. Copyright © Allyn & Bacon 2002 What is an Economy? A system of production, distribution, and consumption of resources, including."— Presentation transcript:

1 Consumption and Exchange

2 Copyright © Allyn & Bacon 2002 What is an Economy? A system of production, distribution, and consumption of resources, including the cultural beliefs that support economic processes: The activities people engage in to obtain goods and services

3 Copyright © Allyn & Bacon 2002 Economic System n The part of society that deals with production, distribution, and consumption of goods and services. n The way production is organized has consequences for the family and the political system. n Economics is embedded in the social process and cultural pattern.

4 Copyright © Allyn & Bacon 2002 Points Regarding Economic Analysis n One of the aspects of studying economic systems is understanding the motivations of the participants: the Emic perspective. n Various cultures, and subcultures, have different economic goals. This is important to realize….that materialism is not universal or defined in the same way in each culture. Each culture has its value scales. n Risk-avoidance is also very important.

5 Copyright © Allyn & Bacon 2002 Allocating Resources n Each society has rules to regulate access to resources: –Land, water, labor, and the materials from which tools are made. n Productive resources are used to create other goods or information: –Material goods, natural resources, or information.

6 Copyright © Allyn & Bacon 2002 Sexual Division of Labor n Universal characteristic of society. n In foraging societies, men generally hunt and women generally gather. n In agricultural societies, both men and women play important roles in food production. n In some societies modes of exchange may be divided along gender lines.

7 Copyright © Allyn & Bacon 2002 More Economic Terms EXCHANGE : The practice of giving and receiving valued objects and services. n Exchange is generally classified into three systems (modes): –Reciprocal exchange –Redistribution –Market exchange

8 Copyright © Allyn & Bacon 2002 Three Main Systems of Exchange n Reciprocity – mutual give and take among people of equal status. n Redistribution – goods are collected from members of the group and given back to the group in a new pattern. n Market exchange – goods and services are bought and sold at a price determined by supply and demand.

9 Copyright © Allyn & Bacon 2002 Exchanges Involve: n Material goods n Symbolic goods n Labor n Money n People

10 Copyright © Allyn & Bacon 2002 Reciprocal Exchange n Individuals contribute to the system without any set rules regarding quantity or timing, and material is distributed according to need. n The flow of products and services is not contingent on any definite counterflow n Usually characteristic of relatively egalitarian societies n Exists in some form in every society

11 Copyright © Allyn & Bacon 2002 Reciprocal Exchange n IT IS VERY IMPORTANT TO REMEMBER THAT ECONOMIC SYSTEMS FUNCTION WITHIN SOCIAL RELATIONSHIPS n IN MOST PRE-INDUSTRIAL SOCIETIES KINSHIP IS VERY IMPORTANT IN ECONOMICS n IN RECIPROCAL SYSTEMS KINSHIP AND OTHER STRUCTURES INSURES COMPLIANCE AND RECIPROCITY.

12 Copyright © Allyn & Bacon 2002 Basic Types of Reciprocity n Generalized reciprocity: nothing expected in return – common among closely related people – expressions of thanks and gratitude uncommon (cf !Kung) n Balanced reciprocity: based upon equality of exchange –applies in relationships with trusted trading partners –Increases with social distance between the parties n Negative reciprocity: competitive and mistrustful –usually applies to relations between individuals outside the local social network –Reciprocity must be assessed and confirmed

13 Copyright © Allyn & Bacon 2002 The Relations of Reciprocal Exchange n People act in the expected way not because of the economic benefits necessarily, but because of the social cost if they do otherwise. n When dealing with another social or political group, these rules no longer apply. Therefore the social interactions of trade will be completely different than with the members of the society. n One of the Ways in which this might be accomplished is with the silent trade system. Silent trade was often used between unknown groups, or between agricultural and hunter-gatherer groups.

14 Copyright © Allyn & Bacon 2002 Redistribution –An Extension of the processes of reciprocity, but with slightly different relations. –Materials are brought to a central location by different individuals, sorted, and given away to producers and non- producers alike.

15 Copyright © Allyn & Bacon 2002 Redistributive Exchange Basic redistribution types: n Alternative (Non-Market) Systems: Redistribution as an alternative to the market system n Market Systems: an exchange of goods and services which may or may not involve symbolic money (e.g. bartering)

16 Copyright © Allyn & Bacon 2002 Non-Market Redistribution n Egalitarian Redistribution –Carried out by a distributor who does not benefit materially from the exchange, but may gain in prestige. n Stratified Redistribution –Orchestrated by the distributor who gains material wealth from the exchange

17 Copyright © Allyn & Bacon 2002 Geography of the Kula Ring

18 Copyright © Allyn & Bacon 2002 ISLAND TRADIN G ISLAND TRADING ISLAND TRADING ISLAND TRADING ISLAND TRADING Red shell necklaces White shell armbands Balanced reciprocity - the kula ring

19 Copyright © Allyn & Bacon 2002 KULA RING: An elaborate trade partnership between the Trobriand Islanders and the Dobu- speaking people of the DEntrecasteaux Islands. n The central items of exchange are called vaygua and consist of arm-bands and necklaces. n The necklaces pass clockwise from island to island, the armbands counterclockwise.

20 Copyright © Allyn & Bacon 2002 A Kula Canoe

21 Copyright © Allyn & Bacon 2002 Valuables exchanged in the Kula Ring: Mwali armshells These are cut from a cross-section of a cone shell (Conus millepunctatus) and decorated with egg cowry shells (Ovula ovum). n The size of the armshell is indicted by the number of cowries tied to it. n Armshells are often too small to wear and large ones are only worn on the owner's arm for important ceremonies, so they are usually suspended on a braided rope. Mwali were made in the Trobriands and on Woodlark Island. Trade beads, seeds and shell disks (sapi sapi) are added to enhance the mwali and make it rattle when the owner walks. n Mwali travel counter-clockwise. They are considered female. During Malinowski's time they were exchanged as pairs, but now travel as singles. Shells are classed and ranked by size, quality, polish, age and history.

22 Copyright © Allyn & Bacon 2002 Valuables exchanged in the Kula Ring n Bagi necklaces are made of red disk beads cut from chama shells. Necklaces were made from imported shells from the Louisiade Archipelago. The red shell disks form the bagi's "abdomen" and "ear". Its "head" is a cowry and its "tail" is a pendant made of pearl shell or other shell elaborated with trade bead and seed tassels. Soursce: n Bagi travel clockwise n They are considered male. n Only women wear bagi. n Bagi are ranked by color (salmon red is best), fineness of the disks, age and history.

23 Copyright © Allyn & Bacon 2002 Valuables exchanged in the Kula Ring Other items of ranked exchange have included –straight whalebone and crescent-topped turtleshell –lime spatulas –polished greenstone axes –doga necklaces with boar's tusks –shell pendants –Many other unranked gifts are included as part of the competitive ceremonial exchanges.

24 Copyright © Allyn & Bacon 2002 Northwest Coast Lodge n

25 Copyright © Allyn & Bacon 2002 What is a Potlatch? Potlatches were social occasions given by a host to establish or uphold his status position in society. Often they were held to mark a significant event in his family, such as the birth of a child, a daughter's first menses, or a son's marriage. Those held by commoners were mainly local, while elites often invited guests from many tribes. Potlatches were also the venue in which ownership to economic and ceremonial privileges was asserted, displayed, and formally transferred to heirs. Most native cultures on the Northwest Coast had potlatches. These events were held either inside large longhouses, like the one depicted in this painting by John Webber, or outdoors. Source:

26 Copyright © Allyn & Bacon 2002 Why Potlatches? n Among the HAIDA, TSIMSHIAN, and Tlingit, major potlatches were part of a chief's mortuary observances for investiture of his recognized heir n Among the KWAKIUTL, a chief normally potlatched to transfer his position to his heir n Lesser potlatches were given to remove the stigma of a slight or accident to a chief or heir. n "Rivalry potlatches" occurred when, with no living direct heirs, remote relatives claimed the right to the vacant status.

27 Copyright © Allyn & Bacon 2002 What Happened at a Potlatch? n Within the potlatches of the northwest coast the object was to exhibit the wealth and power of the families, especially the chiefs or clan leaders. This was done by conspicuous show of wealth in the form of potlatches. n At a potlatch the host would give away massive amounts of food and valuables, such as copper and garments. The amount of materials would be carefully recorded by both sides. n The guests were obligated to accept the gifts, and by doing so were obligated to give back as much or more in a potlatch of their own. If they were unable to do so great shame was brought upon them.

28 Copyright © Allyn & Bacon 2002 Why Potlatch? –The resources in the northwest were very rich and relative wealth could be increased simply by increasing the amount of labor devoted to procurement. –Thus an increase in manpower was directly related to an increase in production. –Potlatches were a way of establishing political alliances by luring people to areas with more resources, and it served to generally increase the standard of living for all by placing an emphasis on the intensification of production

29 Copyright © Allyn & Bacon 2002 Some Causes of Change in Patterns of Consumption and Exchange: –Lure of Western goods –Cash cropping and declining nutrition –Effects of privatization –Credit cards

30 Copyright © Allyn & Bacon 2002 White Bread in Ecuador Bread is associated with dominant cultures; porridge is associated with dominated cultures. In a village in Ecuador, children are demanding more bread instead of the usual barley gruel which increases the role of purchased foods and dependence on cash. This, in turn means more dependence on male wages and less dependence on traditional female provisioning. - Weismantel, 1989

31 Copyright © Allyn & Bacon 2002 Market Exchange n Principle distribution mechanism in most of the worlds societies. n Impersonal and occurs without regard to the social position of the participants. n When this is the key economic institution, social and political goals are less important than financial goals.

32 Copyright © Allyn & Bacon 2002 Money The use of an object to symbolize and measure the social value of other objects. n Money typically has the following characteristics : 1.Portability : Convenient to be carried 2. Divisibility: Can be divided into various values which are explicit multiples of each other 3. Convertibility: A higher valued denomination has the same value of a specified number of lower value. 4. Generality: Everything has a price 5. Anonymity: Anyone who has enough money can make the transaction. The value of the money is not effected by personal relations. 6. Legality: The form and quantity of the money in circulation is controlled by a central government/organization.

33 Copyright © Allyn & Bacon 2002 Capitalism An extreme form of monetary economy where everything, including labor, land, and housing, is assigned a value. n Economic system: –People work for wages. –Land and capital goods are privately owned. –Capital is invested for individual profit. n A small part of the population owns most of the resources or capital goods.

34 Copyright © Allyn & Bacon 2002 Entitlement Bundles Socially defined rights to life-sustaining resources Through entitlements (own land, money from job, inheritance) people provide for their consumption Indirect Riskier eg. welfare checks Industrial societies Direct Most secure e.g. owing land that produces food Foraging societies

35 Copyright © Allyn & Bacon 2002 Entitlement at 3 Levels n Global –The global economy means some countries are more secure than others –Famine n National n Household

36 Copyright © Allyn & Bacon 2002 Consumption and Microcultures n Class n Gender n Race n Age

37 Copyright © Allyn & Bacon 2002 Budgeting n Household expenditures (and who they are spent on) depend on the decision maker –Male budgetary control –Female budgetary control –Pooling system –Non-pooling system

38 Copyright © Allyn & Bacon 2002 Food taboos Can be explained ecologically - Harris What people eat has more to do with the value of food as a way of communicating meaning about the world - Douglas Case study: Jewish and Muslim taboos on eating pig meat


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