Toy Shopping in Tough Times

Source: Business Week Online November 19, 2008

Author: Reena Jana

Concept: Discretionary spending, recession

Brief Synopsis: This article is interesting in that it talks about spending on toys and how this spending is affected during a recession. With the holiday season in full swing toy makers expect to see constant sales. According to the article, although adults tend to cut back on discretionary spending, such as gadgets and "toys" for themselves, they tend to continue to purchase toys for their children. As a result, the toy industry is known as recession resistant, even recession proof.

My Thoughts: This is something that I've never really thought about, probably because I've never seen the economy as bad as it is now. However, I find it interesting that the toy industry can endure recession. Then again, looking back at my childhood my parents always did without so my brother and I could have nice things. Even today my mom will go without buying new clothes to help me with my cost of living if needed. Reading this article got my mind racing wondering what else weathers the storm. Obviously bad habits such as smoking and drinking tend to remain the same-as these industries are highly inelastic and something people become dependent on. However, other than the necessary items, I can't think of discretionary spending habits that would remain constant in a depression. Perhaps movie rentals would increase if people get rid of cable to save money?