INTERNATIONAL CONVERGENCE OF TASTE

A rapid convergence of tastes is taking place in the world today. Tastes in the United States affect tastes around the world, and tastes abroad strongly influence tastes in the United States. Coca-Cola and jeans are only two of the most obvious U.S. products that have become household items around the world. One can see Adidas sneakers and Walkman personal stereos on joggers from Central Park in New York to Tivoli Gardens in Copenhagen. You can eat a Big Mac in Piazza di Spagna in Rome or Gorkeys Square in Moscow. We find Japanese cars and VCRs in New York and in New Delhi, French perfumes in Paris and in Cairo, and Perrier in practically every major ( and not so major) cities around the world. Texas Instruments and Canon calculators, Zenith and Hitachi portable PCs, and Xerox and Minolta copiers are found in offices and homes more or less everywhere. With more rapid communications and more frequent travels, the worldwide convergence of tastes has even accelerated. As a result, firms must increasingly think in terms of global production and marketing to remain competitive in todays rapidly shrinking world. Even small firms must constantly worry that new global products do not wipe out their entire product line overnight.

In his 1983 article The globalization of Markets in the Harvard Business Review, Theodore Levitt asserted that consumers from New York to Frankfurt to Tokyo want similar products and that success in the future would require more and more standardized products and pricing around the world. In fact, in the country after country, we are seeing the emergence of a middle-class consumer lifestyle based on a taste for comfort, convenience, and speed. In the food business, this means packaged, fast-to-prepare, and ready- to- eat products. This is the inevitable result of the information revolution, from people traveling more and more, and seeing the same movies and TV shows. Market researchers have discovered that similarities in living styles among middle-class people all over the world are much greater than once thought to be and are growing with rising incomes and education levels. With the tremendous improvement in telecommunications, transportation, and travel, the cross-fertilization of cultures and convergence of tastes can be expected only to accelerate in the future- with all its important implications for consumers, producers, and sellers of an increasing number and variety of products and services.

Source: Dominick Salvatore, Managerial Economics

QUESTIONS:

What are the condition/(s)of international convergence to taste? Discuss your answer. How does this convergence promote consumer welfare?