Saturday, December 12, 2009

"L'Oreal Professor" - The Density of Globalization

I am reading Bryant Simon's Everything but the Coffee: Learning About America from Starbucks. He is talking here about the fight between Starbucks and the Ethiopian government (aided by Oxfam) over trademarking the names of famous types of Ethiopian coffee.

I was struck by the density of the intertwined global world, going way beyond this Starbucks question, in this sentence:

Douglas Holt, the L'Oréal Professor of Marketing at Oxford University's Saïd Business School and an Oxfam ally, warned that Starbucks was playing "Russian roulette" with its brand, putting the company in "significant peril."

Friday, December 11, 2009

He Invests Aggressively, She Shops Aggressively, They Lose Money

Ronald Wilcox has a fine little piece in the State of our Unions report that I have been blogging on this week. In many couples, he controls the long-term investments, while she controls the daily finances. This division of labor, Wilcox says, has some costs.

Men are overconfident investors, and are more aggressive in trading the household's stocks and bonds. They do worse than the average woman would, because women generally are more cautious and better informed about investment.

Women are confident shoppers. They are generally better informed than men about what products are and where to get them. Partly as a result, they tend to be more aggressive in shopping, spending more time seeking bargains and buying things.

Wilcox suggests that most couples would be better off combining these tasks, if not swapping them altogether.

I personally am a cautious investor and a reluctant shopper. The message I take from Wilcox's report is that all couples would be better off if they did less buying.

Thursday, December 10, 2009

Marital Status Still Follows the Business Cycle, But Not as Much as It Used To.

Alex Roberts has a fine article in the new State of Our Unions on the declining relationship between the business cycle and the divorce and marriage rates.

The divorce rate goes down in recessions. It appears to be going down now. So does the marriage rate. Divorce and marriage are expensive. Most of the reduced demand for these expensive changes is just being put off - when economic times get better, the marriage rate will go up (yeah!) and so will the divorce rate (boo!).

The interesting new development is that these family rates are less tied to the business cycle than they used to be. Roberts' reading of this change: marriage is less of an economic decision. For men and women with careers, marriage is more of an emotional union. They can afford to both marry and divorce when they feel like it. For people without steady work, both marriage and divorce as seen as so risky that they just skip the whole thing - shacking up and splitting up whenever.

The irony, Roberts points out, is that marriage is still the great wealth producing institution for most people. The folks who benefit most from marriage financially are the poorest - the very people least likely to marry.

Tuesday, December 08, 2009

Financial Fights Are the Best Predictor of Divorce

The 2009 edition of The State of Our Unions has just been released by the National Marriage Project under new editors Brad Wilcox and Elizabeth Marquardt. The focus of the report this year is financial issues that affect marriage, especially during this recession.

The lead report is Jeffrey Dew's "Bank on It: Thrifty Couples Are The Happiest." I want to lift up three particularly interesting points from his study.

Paul Amato and Stacey Rogers showed a decade ago that the top three predictors of divorce, in declining order, are extramarital affairs, drug or alcohol abuse, and "feeling that one's spouse spent money foolishly."

The trend of a couple's relation to debt was a significant factor in their happiness. If they started in debt but reduced it, they became happier; if they started with no debt but added to it, they became unhappier.

Third, Dew's own study found that the amount of conflict over money matters predicts divorce better than any other factor.

Monday, December 07, 2009

Women Surpassing Men in Schooling Creates a Marriage Problem

Women outnumber men as college graduates and among masters degree holders. For every hundred women with a B.A., there are only 74 men; for every hundred women with an M.A., there are only 62 men. As F. Carolyn Graglia points out, this creates a marriage problem.

Women prefer to marry men who are more educated than they are.

We rightly hail women's educational achievements. The fact that women caught up to men in their amount of schooling shows that the old discrimination is dead.

We may not have noticed, though, that something new has happened with women surpassing men in school. It becomes harder for women to make the kind of marriages they prefer. The good news is that college-educated women are now marrying and having children at a higher rate than they did when we first passed this tipping point. The bad news is that the most educated women are much less likely to marry and have children.

I think the great mass of women will still want to marry men more educated than they are. And I think nearly all wives want to be able to respect their husband's minds. But for the most educated women and men, a small new social movement may be necessary to work out solid marriages in which she is more educated (and probably makes more) than he. Fortunately, if there is any group in society that should be capable of figuring out the advantages of this new balance of marriage, it would be the most educated.