For the past three decades, only one economic variable has exhibited strong steady growth year in and year out. I refer, of course, to the size of shopping carts. According to the grocery store managers I just spoke to, today’s average cart is almost three times as large as its 1975 counterpart. That’s remarkable because by 1975 the growth spurt had already been underway and apparent to economists for several years.
Although I can’t conjure a citation from NEXIS or the Web, Ralph Nader is said to be one of the first to notice the growing-shopping-cart phenomenon. He is said to have offered it as a prime example of how consumers are manipulated by unscrupulous capitalists: Bigger carts were designed to shame consumers into bigger purchases.
Even if we accept the dubious presumption that a normal shopper would be embarrassed to have the neighbors see him roll up to the checkout line with a half-full cart, this explanation lacks fundamental logic. That’s because it’s a story about why shopping carts are big, not a story about why they’re getting bigger. As soon as some clever grocer figures out that big carts mean big purchases, carts should immediately get bigger—and stay that way.
Shortly after the big cart hypothesis surfaced in the mid-’70s, the topic started showing up on exams in the economics department at the University of Chicago, usually attached to a question such as, “Explain why Mr. Nader can’t be right, and offer an alternative explanation that can be right.” The answer the professors had in mind was this: Until recently (or what was then recently), most households had a member (usually called the “wife”) whose full-time job description included a weekly shopping trip. The entry of women into the work force changed all that, so shopping trips became less frequent and shoppers wanted to buy more per trip.
There’s an old joke about the graduate student who discovers that the exam questions are the same every year but that the answers are always different. As the shopping cart question grew to legendary status, students began competing to offer new and more creative solutions. Nowadays I teach a freshman honors seminar in economics, and I often throw the question out to my class on the first day. To my never-ending surprise and delight, I get at least one new and thoughtful answer every time I do this.
For example: People are a lot wealthier now than they were 30 years ago. That means they are willing to pay higher prices for the luxury of shopping in wide aisles. (Wide aisles drive up prices because they require a bigger investment in land.) Once you’ve got the wide aisles, you might as well have the bigger carts. (Actually, this one came not from a student, but from my father—thanks, Dad.)
Or: Houses are a lot bigger now than they were 30 years ago. That means more space in the pantry, so people can buy more food on each trip.
Or: Most people used to shop with cash, and their purchases were limited by the amount of cash they were willing to carry. As credit cards became ubiquitous, more and more shoppers were willing to fill up a big cart. This one is testable: It predicts that stores will offer a mix of small carts (for cash shoppers) and large carts (for credit card shoppers) and that the proportion of large carts should grow over the years. By contrast, some of the other theories predict a steady growth in the size of all carts.
Or: Now that people are richer, they’re more likely to cook several dishes for the same meal. Or: Now that people are busier, they’re more likely to eat separately rather than as a family, and hence to cook more meals per household per day. (Of course, this also cuts the other way—busier families are more likely to eat at restaurants.)
Or: Technological improvements have made it easier for each family member to have the food he prefers. Frozen dinners are a lot better now than they used to be, so a family of five is more likely than before to eat five frozen dinners than to share a single meatloaf. Sometimes even a minor innovation can have a huge effect on purchasing habits. When packaged pies were available only in 14-inch sizes, apple was the best-selling flavor. When 7-inch pies became available, apple immediately fell to somewhere around fifth place. That’s because in the old days, the whole family had to agree on a pie, and apple was everyone’s second choice. Now that everyone can have his own pie, very few choose apple.
One reason I like throwing this problem out to the classroom is that it gives us a chance to talk about the difference between a good and a bad theory. A good theory doesn’t just explain why shopping carts grow; it has to explain why they’ve grown at this particular time. Changes in income, changes in the labor-force participation of women, changes in payment habits, and changes in technology are all plausible starting points for a good theory.
By contrast, a theory that says shopping carts are large because people like to have a lot of vegetables is no good unless you explain why people have gradually come to like vegetables more over this particular time period—and why people who are buying more vegetables would not buy correspondingly less meat. A theory that blames the whole thing on more effective advertising, creating an army of zombielike consumers who must have their morning Trix, is no good unless it explains why Trix don’t just replace corn flakes.
I once did a radio call-in show in Pittsburgh called “Economist With Attitude.” I asked the shopping cart question, callers offered solutions, and there was a prize for the one I disliked the least. I am dismayed to report that I don’t remember the prize-winning entry. Is there a reader from Pittsburgh who can remind me? Drop me an e-mail at armchair@troi.cc.rochester.edu.
Better yet, if you have an explanation that should have won, send it to armchair@troi.cc.rochester.edu. I’ll append this column with the best explanations.
