Induced Demand and Manufactured Demand

As I said previously, I have a lot to say about induced demand. That’s because as I look around, I start to see it in so many places. Though many people will call it manufactured demand. For me they are very similar. Almost the same, certainly close siblings. And they both annoy me and I’m on a kick about it because so much of it is turning out to be bad for us and the environment.

Before we get too far, I want to say, I am not immune to either induced demand or if you prefer manufactured demand. I have been known to use a new, bigger road, or buy more to fill a bigger space. It happens. I’m not condemning people for it. I’m pointing it out because I want to point it out for myself. 

Street scene in Paris France with one car driving and cars parked on the sides of the street with buildings and people on the sidewalks

So, let’s look at another induced demand. Or manufactured demand. You choose. 

Homes and suburban living. In the United States, suburban living is marketed as the ideal. You want a nice big house tucked away in some quiet neighborhood with not a lot of traffic where you feel like your kids will be safe to play outside even though we’re too scared to let them. Since we are stuck so far away from a social life, we are sold bigger and bigger homes. I grew up in a 4-bedroom 2-bathroom house that was 1148 square feet built in 1969. It was a fine size and fit for my family that was either 4 or 5 people, or 4 people and a business. I currently live in a 2-bedroom with a bonus room, 2-bathroom condo that is 1184 square feet. My owner suite of a walk-in closet, bathroom, and bedroom is big enough to be two bedrooms, with closets, and a bathroom. I’m one person. And yet I have filled my closet completely.

It is difficult these days to find, and purchase a small place, especially if you want new. People aren’t building them unless you go the tiny house route. But that’s not the point here. The point is more about how with bigger places we end up buying more stuff. If I were to buy a home that was say 300-500 square feet bigger, I have been conditioned that instead of enjoying that extra space as space and maybe spreading out the already too much stuff I feel I have, that I need to buy more furniture, or other stuff to fill it. This seems like that induced demand. Give me more space and now I’ll fill it and then some analyst comes by and says, ‘see we told you; you needed more space.’

Did I? Did I really need more space, or did I need, less stuff, or a better use of the space I had, or maybe more opportunity to get out of my home without it being a chore. Maybe I need more community spaces that are safe and don’t require membership because if it requires membership, it isn’t a community space. 

Back to the big house that I now have to fill, or so I’m told, and clean. I purchase a big house. It comes with a big kitchen, a big refrigerator, a big dishwasher, a washing machine, and a clothes dryer. The house is designed for this. Each of these creates a level of demand. Oh, and with that house comes restrictive covenants that dictate what I can’t do or have. As an example, in my community all of the outsides of the widow coverings have to be white or beige. This is depressingly boring. I want to see sponge bob curtains on the kid’s rooms and fun flowy colors on the rooms of the teens but nope, not allowed. Another thing I can’t do is to use my balcony to dry clothes. And there are many single-family home communities where even in a fenced back yard you are not allowed to have a clothesline to dry your clothes outside. But I digress, a little, because it is still relevant to induced and manufactured demand.

So, we have created restrictive covenants that create a demand, induced or manufactured, that require we have clothes dryers. You could say we aren’t required to because we could lay them out to dry in our homes. And that would be the case if you hadn’t filled that home with all that stuff that you were encouraged to fill it with.

Business with a red awning with the business name on front. Business name is Ghezzi. Two people walking on the sidewalk in from going opposite directions

The dishwasher is another item I want to address. Have you heard the advice that to run the dishwasher efficiently it should be full? Yeah. That’s what I’ve heard too. And I’m not going to argue with it. I mean really if you are going to use that much water and electricity to clean your dishes better to clean as many as possible for that amount of resources. I get it. But what about the part where you need more dishes and cookware because some of it is in the dishwasher, dirty, waiting to wash, or some of it is in the sink waiting for the next round of the dishwasher. I know I don’t always stop and think ‘oh, I could just wash this one item instead of waiting for the dishwasher’. Or that I could get that one pan out of the dishwasher and hand wash it so I can use it tonight. Instead of needing to have two of those pans. Not because I use two at a time rather because one might be dirty. Because the dishwasher is more efficient if it’s run when it’s full. And supposedly, the dishwasher is more efficient and better at getting your dishes clean. Really?

What about cleaning? I mentioned that earlier. I can’t say this is as insidious. And it really is more of a manufactured demand. That doesn’t make it any less annoying. There is this really great cleaning tool and system called Swifter. It is convenient. It also has its own manufactured demand. Those little cloths that go on the bottom of the stick to pick up the dirt, they are a manufactured demand. We think, because that’s what is advertised, that for those things to work we have to buy their single use cloths that we can then just throw away. Wait what? Last time I looked, a box of 52 of those little guys was going for roughly $15. Ok that’s “only” about $.29 each. How is that a big deal or expensive. They go in the landfill, and they are made from a microfiber with leaches into the water supply and everything else. And if you use more than one a week that cost of ownership and usage goes up considerably. And here, a dirty house is a reflection of how good a person you are. But that’s a topic for another time.

Now we have our big house, with our big appliances, and our disposable cleaning supplies, and we need to fill it. But we live a car ride, not walking distance, from the nearest store for groceries or other goods. We could have them delivered, yes, but that’s lazy, or something. Because everyone knows that if you don’t get your own groceries then you aren’t a regular person. Fortunately, the pandemic has shifted some of this attitude as well as access to this type of service. However, like so many things, there is a downside. Again, another topic for another time. Back to the house we have to fill.

Houseboat on the water hidden behind some trees

We need to fill the refrigerator with food for it to run efficiently, we need to have enough dishes and cookware to fill the dishwasher, so it runs efficiently, and we have enough dishes to continue to feed ourselves while the dishwasher is running, or waiting to run, and we need more stuff to fill all those big rooms, so we don’t look poor. Now we need a car. Need. Because we can’t get to anything without one. And if we could, chances are the infrastructure isn’t available to make getting to those places without a car safe. Now the car has become a demand. 

And what a demand. A demand that creates demand. I’m referring to my first post about induced demand. The car demands fuel, of some sort, as well as roads that will either be too congested or soon to be too congested. The car also demands a place to be parked whether at home waiting to be driven by people to places, or at work waiting to be driven home again. But not just any old car will do. We live so far away from the grocery store, the shopping mall, and the children’s school that we need a big enough car, an SUV, to carry all the groceries home, or all our shopping to fill up our big homes and get it home, or our children and their friends to every activity they might want or need to participate in. Not only has the car become a demand, a necessity, it has also become bigger, and it needs more of everything, thus a demand that creates demand.

It creates another demand besides the resources it needs or encourages. It creates a health care demand. Let’s talk about that in another post. If I start that now, you’ll be reading past lunch or be late for that meeting. 

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