Recent Developments in European Consumer Policy Research

Folke +lander, Aarhus School of Business Administration and Economics
ABSTRACT - In this review of European research in the consumer policy area, an attempt is made to illustrate the scope of issues that have been broached. References are given to both theoretical and empirical literature of the last decade with an emphasis upon publications in English and German. Important consumer policy issues that, by and large, have escaped the attention of European researchers are also discussed.
[ to cite ]:
Folke +lander (1980) ,"Recent Developments in European Consumer Policy Research", in NA - Advances in Consumer Research Volume 07, eds. Jerry C. Olson, Ann Abor, MI : Association for Consumer Research, Pages: 56-65.

Advances in Consumer Research Volume 7, 1980     Pages 56-65


Folke +lander, Aarhus School of Business Administration and Economics


In this review of European research in the consumer policy area, an attempt is made to illustrate the scope of issues that have been broached. References are given to both theoretical and empirical literature of the last decade with an emphasis upon publications in English and German. Important consumer policy issues that, by and large, have escaped the attention of European researchers are also discussed.


In this paper, an attempt is made to describe some recent European research in the area of consumer policy. The selection of topics is necessarily subjective; apart from being influenced by my own predilections, the coverage is also limited because of language barriers. With few exceptions, the review deals only with material which is available in the English or German languages.

Consumer policy here includes any attempt to ensure that consumer needs be more vigorously heeded in the decisions of private firms and public bodies as well as in the actions of consumers themselves. Although many authors have attempted to give structure to this vast field, there is hardly any agreement as to the most fruitful way of doing so. Be it allowed, then, to give a more impressionistic portrayal of a few areas of inquiry with the principal aim of making the American reader aware of the existence of some European research within the field. In certain cases, the topics to be reviewed have drawn much interest also in the North American research community while in some other cases, this appears not to be so.

Another caveat has to be added. The paper deals with research concerning consumer policy; it does not endeavor to describe actual policy developments in the various European countries, such as new legislation, the establishment of new consumer agencies and organizations, changes in government policies, industry action, etc. There are clearly very many undertakings by legislators, public agencies, consumer organizations, and local consumer groups, as well as by business, having an impact upon the consumer situation and upon consumer welfare, whose presumptions are never tested in a scholarly way and whose consequences are never investigated. This is no less true for Western Europe than for North America. But owing to the format of this review, such cases will, by and large, not be dealt with here.


A substantial amount of European consumer policy research is carried out by law scholars, describing and discussing planned and completed legislation, suggesting changes in current law, analyzing case law, and comparing the solutions found to consumer legislation problems in the various European countries. Not too infrequently, European consumer law scholars seem genuinely interested in incorporating concepts and theories of the behavioral and economic sciences in their thinking and writing. One example of this is the co-founding of the European quarterly Journal of Consumer Policy by a law scholar, an economist, and a psychologist, and the publishing side-by-side in this journal of social science and legal science papers with at least the occasional attempt at an integration of the two strands of exploration. As an example of this trend one could mention a series of papers and comments on the pros and cons of the institute of recommended prices, with participation of both law scholars and economists from a number of countries (Reich 1977a; Schultes 1977; Pickering 1978; Sch÷ppe 1978; Murphy 1978; Howe 1979; Pickering 1979). [A very terse summary of these papers would be that most contributors describe a de-facto development towards the abolition of such pricing practices and find the theoretical arguments against the institute more compelling than the arguments in favor, but that two authors, from West Germany and the U.K., respectively, after examining the available empirical evidence of the effects of recommended prices, come out in favor of admitting the institute at least in certain cases.]

Other examples of this trend towards the combination of legal and social science approaches are the attempt by v. Falckenstein (1978) to estimate the amount of consumer losses caused by unfair competition, based on the analysis of complaints reaching consumer organizations, the extensive analysis of the interrelationship between the economic and legal aspects of a market economy by Reich (1977b), and the attempt by two Swedish lawyers to scrutinize, also in its economic aspects, the practice of product differentiation by giving different trade marks to identical products (Bernitz and Pehrson 1978). In spite of such promising occurrences, there is no doubt a long way to go before regular collaboration between practitioners of social and of legal science becomes a common event. Possibly, however, the fact that there are much fewer scientists (all disciplines included) who take an interest in consumer affairs in Europe can have the somewhat paradoxical, positive effect that there, disciplinary borders get crossed more often by scholars looking for colleagues with similar substantive interests.

For more intradisciplinary descriptions of recent developments in European consumer law, one can refer to, e.g., as regards Great Britain, Cranston (1978, 1979); Germany, Reich, Tonner, and Wegener (1976); Scandinavia, Bernitz (1976), and Dahl (1974/75; a bibliography); and with respect to the attempts at creating a unifying consumer legislation within the Common Market countries, Kramer (1978), and Reich and Micklitz (1979).


A characteristic feature of European literature on consumer policy is the heavy emphasis on developing theoretical frameworks with the aid of which consumer problems and actions can be analyzed, and on which consumer policy can be founded. This applies, in particular, to the German literature.

The economist Scherhorn has been influential by advancing in a series of papers and books (Scherhorn 1975, 1977, 1979a, b; Scherhorn et al. 1973, 1975) a theory which spells out in some detail the power relations and conflicts in the market place. In Scherhorn's model, it is regarded as unrealistic to insist upon consumer sovereignty. Not only consumption, but also work, serves to satisfy human needs, and since in principle the needs satisfied by the two activities are not identical, what has to be striven for is an equilibrium between the two, often opposed, interests. In a world which does not correspond to the model of a market as a meeting-place of powerless suppliers and fully and objectively informed consumers, with homogeneous products and uniform prices, the possibility of abstention from buying, the exit option, does not suffice in preventing a dominance of the producer interest. This dominance leads to a unilateral consumer adaptation to producer needs. Competition policy must therefore be supplemented with a public consumer policy which furthers the consumer interest. Such a policy has to include prescriptions for the production and promotion of goods and services, but should also support systems of consumer information and the formation of consumer organizations. To Scherhorn, it is important that the consumers be given a whole range of voice options so as to make it possible for them to exercise control over the producers. A series of mechanisms for the securing of such control are outlined in detail; they include various forms of protest and negotiation. To Scherhorn, voice remains ineffectual, however, unless there is also access to the exit option. In Scherhorn's writings much stress is laid upon noncommercial information as a means of improving the consumer situation; the efficiency of both exit and voice options is seen as seriously threatened unless the dominance of producers over the communication system of the market-place is broken. For a more detailed presentation and critical evaluation of Scherhorn's model (in English), see +lander and Lindhoff (1975).

Other German writers have directed various kinds of criticism against the model just outlined. Kroeber-Riel (1978a, b) has attacked the type of thinking that this model represents for, among other things, assuming that consumers can be regarded as cognitive information-processing machines which can be brought to act rationally if only provided with enough information. He stresses the importance of emotional factors in the determination of behavior, as well as the existence of habitual, routinized purchasing. This means, among other things, that not only false, but also emotionally suggestive advertising has to be regulated. Furthermore, one should support the consumer's desire to set up part of his consumption as very routinized acts in which information-processing is not required. Kroeber-Riel argues in favor of a pragmatic goal-setting for public consumer policy, and formulates its three main goals as: promotion of routinized consumer decisions; the use of consumer education to furnish consumers with "problem-solving programmes" which can be put to use in decisions where high risk is involved; and protection against the deleterious influences of marketing activities.

The so-called "Wuppertaler School" (Biervert, Fischer-Winkelmann and Rock 1977) is critical of the models advanced by Scherhorn, Kroeber-Riel, and others. It sets out to construct meta-rules for how consumer policy researchers should live up to the responsibility of establishing a participatory/emancipatory discussion in society. The goals and the action potential of consumers should be discovered in a continuous discourse with the consumers themselves. Only the existence of such a discourse can give the necessary legitimation for building a theory of consumer action research. In the group's writings, much emphasis is also put on repealing the compartmentalization of the production and consumption spheres of life: The mutual relationships between work and consumption have to be looked into much more closely, and it is suggested that there could be a fruitful interaction between the attempts of workers to achieve more self-determination in the production sector, and the attempts of consumers to achieve more participation in decisions about production and distribution of consumer goods and services.


According to Scherhorn and other writers, reaction is constitutive of consumer behavior in the market place. The consumer's freedom of action is restricted to reactions towards the offered goods and services. And truly, even most operations recommended by consumerists have an ex post character: tests and dissemination of information concerning already marketed products; more loudly voicing dissatisfaction with purchased goods and services; taking producers to court for having launched products not complying with existing law, having used illegal sales and promotion techniques, etc. Yet: Although few scholars would probably dispute that the producer has a much wider set of action parameters at his disposal, a lot of recent interest has been shown in investigating means of increasing the scope of consumer action (as opposed to reaction). Czerwonka, Schoppe, and Weckbach have, in a book entitled "The active consumer: Communication and co-operation" (1976), surveyed a long array of possibilities of increased ex ante influence upon the product supply. The authors are relatively optimistic about the long-run possibilities of developing new institutions suitable for communicating consumer ideas and needs to producers, and to make consumers more "creative." They propose the setting-up of test institutes which are specialized in early examination of innovations, extended use of group discussions with consumers, and the founding of so-called "creative centres," in which citizens are given a chance to occupy themselves with various types of constructive and imaginative activities while at the same time communicating product ideas to manufacturers. Most existing means of consumer-producer communication are viewed with a considerable amount of skepticism, however.

This skepticism would presumably include the institution of corporate consumer affairs departments. Fornell (1978), in a recent issue of Journal of Consumer Policy, has adeptly described the role that such departments could play in channeling information from consumers that may be overlooked by marketing research, but the majority of the European commentators on Fornell's article (Hansen and Stauss 1979; Wimmer 1979; Bergstr÷m 1979; Renoux 1979; see also Fornell's rejoinder in a forthcoming issue of the journal) have uttered grave doubts about the ability of these departments to function as "true" consumer representatives. The main reason for this opinion is that the consumer affairs department's need to be able to prove itself useful to the profit-making goals of the firm radically limits the degree to which it can be responsive to consumer concerns.

In another context, Arndt (1977) has deplored the picture that most consumer researchers seem to have of the consumer. He infers that consumers are usually regarded as the objects of research, not subjects, and as the target of marketing activities rather than as the instigators of consumption. And one of the causes, Arndt maintains, is the extended use of the laboratory experiment in consumer research. It may be, then, that not only the constitutive characteristics of the market economy but also the methods used in empirical consumer research influence us in the direction of seeing consumers as reactive rather than active. But see Kroeber-Riel (1977) and Jacoby (1977) for counter-arguments to Arndt's theses.


Marketing research to a very large extent deals with the study of consumers; firms have to get to know their adversaries, as it were. Consumer policy research has not yet arrived at the stage in which a large part of the research concerns the other market side: producers and retailers, with a view to finding our more about actual decision-making within firms, and to discovering weaknesses in the corporate shield which consumers could attack in order to improve their position.

But there is undoubtedly a growing demand for studies of business on behalf of consumers. A research program at the University of Stockholm during the last few years has, for example, devoted much effort to evaluating the behavior of firms and industries from a consumer perspective. In addition to empirical studies which have concerned, e.g., the retailing system for daily purchased goods and the drug industry, the methodological problems involved have also been discussed at a more general level (Wikstr÷m 1977, 1978a, 1979).

More specific aspects of producer performance on which policy researchers have focused are advertising (not unexpectedly) and product differentiation.

Advertising and Consumer Policy

Here, much of the effort-and the debate-has concerned methods of defining misleading or deceptive advertising. In an empirical study commissioned by the Bureau Europeen des Unions des Consommateurs (Arbeitsgemeinschaft 1974), an attempt was made to quantify the amount of misleading advertising in British and German magazines. The methods used became the subject of intensive discussion and criticism, both concerning the degree to which the operational criteria used in assessing misleadingness were unequivocal, and the fact that only "experts" took part in the evaluation of the ads. Starting out from the criticized study, and approaches suggested by, among others, Gardner (1975) and Jacoby and Small (1975), a group of researchers from the University of Mannheim (Raffee et al. 1976) outlined a detailed procedure for measuring "misleadingness," using an experimental approach and actual consumers of the product as respondents. Empirical tests of the method have also been carried out (Raffee et al. 1977). In 1978, the U.K. Office of Fair Trade conducted a large scale empirical study of the degree to which British national advertisers adhered to the advertising industry's own voluntary code of practice, which demands that ads be legal, decent, honest, and truthful, the methods and results of this study, which indicated that almost one in six ads in some way breached the code, have not yet been critically reviewed in the academic literature as far as this writer is aware.

The Danish Social Science Research Council has recently begun to sponsor a number of studies regarding the long-run, societal effects of advertising. One long-run effect may be the conservation of discriminatory attitudes and behaviors with respect to the female sex. Utterstr÷m (1977) describes the attempts by a Swedish working party to define what sex-discriminatory advertising is, as well as the (unsuccessful) attempt of the Swedish Consumer Ombudsman, in a test case, to get the Market Court to prohibit a company from advertising a cleaning and lubricating agent by displaying a picture of a woman's naked back on which the trade name of the company had been sprayed. In Denmark, Sepstrup (1979; in press) in a very comprehensive study of over 4,000 advertisements, representatively sampled from all Danish newspapers and magazines, arrived at the conclusion that there are relatively few individual ads that are sex-discriminatory. But in the world of advertising, the portrayal of the sexes is extremely biased towards showing men working outside the home, women within the home; the man being active, the woman passive; the woman much more preoccupied with her appearance, etc. Sepstrup is firmly convinced, and it is difficult not to follow him at least part of the way, that the total effect of advertising can be a hindrance to the attempts, by other groups and bodies of society, to change the societal roles of man and woman into more equal ones. From a public policy point of view, it is however extremely difficult to find ways of changing the content of advertising in toto, since the legal instruments so far used for controlling advertising can be applied only in individual cases and are powerless when it comes to dealing with "aggregate," "additive" biases.

In certain European countries, there are now legal possibilities of requiring advertisers to include certain essential pieces of information in their advertisements, in a standardized form, given that they decide to advertise. One of the reasons for instituting such a rule is, of course, that advertisements are thought to reach a much wider audience than product information disseminated through channels like testing journals, consumer educational material, etc. So far, however, very little information exists about the extent to which these rules have been implemented, and no critical scrutiny of the reasoning behind, and the effects of, instances where this rule has been enforced seems to have appeared in the scientific literature. A good introduction to the problems that have to be solved when decisions to implement such regulations are taken is, however, provided by WSrneryd (1975).

Differentiation of Identical Products

A not uncommon type of marketing activity has recently become the subject of public debate and some scientific scrutiny in Europe. I am referring to the practice of selling identical or almost identical products under different brand names, i.e., product differentiation by trade marks. According to Swedish law scholars Bernitz and Pehrson (1978), this practice has not been the subject of legality testing in any country. (The practice has sometimes been scrutinized in connection with discussions of price discrimination, in West Germany and in the U.S. for example, but was never tested as a more general principle.) It can be argued, of course, that consumers very often do not realize that products under different brand names are, in fact, identical, and become misled if manufacturers and retailers do not provide this information; by making the market less transparent, the strategy may make consumer decisions less economical and rational.

The Swedish Consumer Ombudsman took a case of product differentiation by trade marks to the Market Court--an identical varnish sold under different brand names and at different prices as ordinary varnish and coating for boats, respectively--and demanded that this practice be stopped or, at least, that the company be forced to inform customers about the identity of the brands. The Ombudsman lost the case. The reasoning of the Market Court has been criticized, however, both by Bernitz and Pehrson (1978) and the Ombudsman, who has now taken another case to the Market Court concerning identical cooking-stoves sold under three different brand names.

As Bernitz and Pehrson have pointed out, the problem of how to judge product differentiation of this kind raises a large number of issues: within the economics of distribution, competition policy, consumer behavior, ethics. To this author, it appears to be a phenomenon well suited for scholarly analysis within the consumer policy literature, whereby the differences in business, consumer, and macroeconomic perspectives could be illustrated in an instructive way. See also Larsen and Dines (1979) for an outline of the different aspects of the problem.


So far, consumer behavior research has mostly dealt with choices at the brand/variety level. But from a consumer perspective, brand choice may be rather unimportant compared with more global aspects of consumer behavior, such as priority patterns among goods, budgeting habits, the allocation of income among saving and some gross categories of spending (food, housing, travel, etc.), consumer attitudes towards and use of public as contrasted with private goods, the importance of buying/ consuming activities in relation to other human activities, etc. Some indications exist that European consumer researchers, and also those with a behavioral science background, are now developing a greater interest in matters connected with household budget allocation. In a recent review, van Raaij (1979) has done an excellent job of both organizing the area and surveying relevant literature from Europe as well as North America. Some earlier attempts to review and structure the field, in particular as regards psychological factors entering into the allocation of income between spending and saving, were made by +lander and Seipel (1970) and Julander (1975).


Interest in the measurement of the degree of consumer dissatisfaction with various aspects of the marketing system and the assessment of perceived consumer problems is growing in Europe, too. In a theoretically oriented paper, +lander (1977a) stressed the difficulties of interpreting satisfaction and problems data, and maintained that such data were almost unusable for setting priorities in public consumer policy. The ambition must be to develop objective indicators of consumer welfare, it was held. Pfaff (1977) countered that +lander was setting up a straw man, since no serious worker in the field would maintain that subjective indicators of consumer well-being should be used without reference to the so-called objective situation which such measures attempt to get at through the eyes of the consumer. He argued, however, that so-called objective indicators were at least as vulnerable to various kinds of relevant criticisms as the subjective satisfaction data; furthermore, "who is to say what a problem is and how it affects the individual's welfare but the affected individual?" (Pfaff 1977, p. 140). Burisch (1977) tried to sift out the most solid arguments used by both sides in this debate. A little later, upon the publication of a report of some results from the Andreasen and Best study of consumer problems in a U.S. sample (Andreasen 1977), another round of discussion of the meaning and usefulness of consumer satisfaction and problems data took place (Wieken 1977; Andreasen 1978). Thus, the "meta-discussion" of the concepts "satisfaction" and "problem" occupies much space in the European literature in this field (see also +lander 1977b).

But empirical research is not entirely lacking either. Mitchell (1977) has described the system that the U.K. Office of Fair Trade uses for analyzing consumer complaints and included certain aggregate data; consumer agencies in other European countries have similar "warning systems" based on complaints data. In a Norwegian study, Gr°nhaug (1977) showed that there are great variations in perceived dissatisfaction and propensity to complain across products, and that only a fraction of the dissatisfied consumers actually complained. Only very modest parts of the variation in reported satisfaction, and in propensity to complain, could be explained by reference to socio-demographic data. In contrast, in a recently completed Danish study Kristensen (1979) found a clear tendency for consumers with a longer education to launch complaints more often than consumers with a shorter education, a finding in line with those of other studies of complainers. The startling observation is, however, that this difference can be explained entirely by the fact that people with higher education are more often dissatisfied; when dissatisfied, low education consumers have the same propensity to complain! Should public policy, therefore, aim at making low education consumers more dissatisfied with the goods and services they procure? Kristensen (n.d.), in answer to this, noted that those consumers who are more often dissatisfied are also those who most often experience positive satisfaction (not merely indifference) with their purchases: Complainers (and members of local consumer groups) report more cases of having experienced unusual satisfaction with products and services than do other consumers. According to Kristensen, the task for policy-makers might thus be, rather, to make people "less indifferent," i.e., making them both more dissatisfied with bad things and more satisfied with good things, undoubtedly a more inspiring task.


Under this heading I want to refer, inter alia, to a paper evaluating the voluntary labeling system in the Swedish furniture market, which summarizes a series of studies of how consumers and producers use and are influenced by the labels (Julander, 1978). Very limited use of the labels was found among consumers, and the study tries to find out why; Julander gives the abstract nature of the labels much of the blame. But another important reason is the limited use of the system by manufacturers and retailers and the lack of incitement for such use. The study is a good example of the need to study all the actors in the market-place if one wants to understand the way a voluntary information system works (or does not work).

In two papers and a book, Silberer (1978, 1979a, b) analyzed the successful attempts by the German product testing organization Stiftung Warentest to increase the dissemination of product test reports by the use of media other than those published by the organization itself, i.e., press, radio, and television, consumer advisory bureaux, manufacturers and retailers, etc. The more difficult question of assessing the test-report efficiency Silberer approaches by outlining a series of efficiency indicators, including many other effects than the impact upon the individual consumer and his purchasing behavior, e.g., changes in product quality and price. Where available, empirical data related to these various effects of test reports are summarized.

Sepstrup (1978a) tried to demonstrate that the "wrong" people, i.e., those with large resources in terms of income, education, etc., use information stemming from comparative product testing; the study concerned buyers of color TV in Denmark. The ensuing discussion (Grunert 1978; Sepstrup 1978b) made clear that various interpretations of the empirical results are possible and that the policy implications perceived vary with the perceiver.

As part of a larger undertaking, Grunert and Saile (1978) recently presented the first set of data illustrating a new method for developing consumer information on the basis of "perceived risks" associated with the purchase of a given product. Further results from this and other West German projects in the area of consumer product information are likely to be forthcoming within the next few years.

Organizational Issues: Who Is to Represent the Consumer:

The question of whether consumers can-and should-be organized to exert countervailing power is one that preoccupies theoretically oriented consumer policy researchers a lot. One can refer, e.g., to Brune (1975), Biervert et al. (1977, pp. 64-83), and Czerwonka et al. (1976, pp. 191-217) for a thorough discussion of such matters. There is uncertainty in an absolute sense: Can consumers on the whole organize themselves in independent, voluntary organizations ("Selbstorganisationen") with any hope of success? There is also uncertainty in a relative sense: Are consumers best advised to get together on their own or are other organizational forms ("Fremdorganisationen"), such as trade unions, umbrella organizations set up by associations primarily formed for other purposes but with large memberships and-often-government support, or government agencies, more efficient care-takers of the consumer interest?

An interesting debate is going on right now in West Germany concerning the legitimation for trade unions to represent the consumer interest. Tonner (in press) finds that the trade unions could be both legitimate and strong proponents of the consumer cause, although he admits that there is, today, a wide gap between the consumer programmes of the trade unions and their policies as evidenced by their everyday activities. Petri (1979 and in press) argues, however, that it is not in the interest of either employees or consumers that trade unions act as chief consumer advocates, and he maintains that trade unions should only occasionally concern themselves with consumer affairs. Many examples of, and reasons for, a conflict of interest between employees and consumers can be given, according to Petri. What one now could wish for are concrete case studies -preferably from different countries - of the role played by trade unions in the consumer policy area, and of the stance taken by the unions in various matters of concern to both consumers and employees.

Damgaard (1979) has just reported on an empirical study, using a Delphi technique, in which he very thoroughly mapped out the goals of public consumer policy that were deemed desirable by representatives of Danish consumer organizations and by consumer researchers. [A report on the goals and activities of Norwegian consumer organizations, has likewise, just been reported (St° 1979).] He found two clusters of views. One group wanted to apply a long time perspective, to stress the societal and global role of consumption, whereby income distribution and ecological considerations are allowed to play an important role, and to change the goals of consumer policy radically: from teaching individual consumers how to shop, buy, and consume, to encouraging collective action. The other cluster had much more of a "here and now" attitude; these respondents focused upon the individual consumer and wanted to educate him so that he can better take care of his own interests, and emphasized measures which will make the market more "transparent." It would seem that the Delphi technique and Damgaard's "goal battery" could easily be applied also in a cross-national context and provide the basis for interesting comparisons of the goals perceived by consumer activists in various countries.


The above smorgasbord listing of current issues in European consumer policy research may have left the reader with a very chaotic impression. That is almost unavoidable since it is of course true, for Europe as well as for North America and the rest of the world, that neither theoretical nor empirical research follows a Great Plan. The attention of researchers is often very fortuitously drawn to certain problems whereas other issues, maybe socially more important or intellectually more challenging, are not attended to. In such a heterogeneous research community as Western Europe, the likelihood of the whole corps of researchers suddenly concentrating their efforts on analyzing one particular problem is small, for better (fads and fashions perhaps becoming less influential than in the U.S.) or for worse (the dispersion of scarce resources leading, perhaps, to a situation in which no single problem is ever studied at depth).

In spite of this, I personally see some promising signs. Increased contacts among policy-makers, both from governments and consumer organizations, in various constellations of European countries (such as the Common Market and the Nordic Council), will eventually lead also researchers from different countries, interested in the same topics, to join forces. This can come about partly as a result of the funding opportunities linked to such political confederations but also for the simple fact that similar phenomena in need of analysis appear in various countries at about the same time, due to common trends of economic development and to the politically brought-about harmonization of market conditions and consumer legislation. Some indicators of such a trend towards a European identify among researchers are the creation of various cross-national associations and groups, such as the European Research Association for Consumer Affairs, the European Academy for Advanced Studies in Marketing, the European Consumer Law Group, the European Group of Economic Psychologists, and the foundation of the bilingual Journal of Consumer Policy/Zeitschrift fnr Verbraucherpolitik.

The preoccupation, at least in certain European quarters, with the construction of a cohesive theoretical framework for defining the consumer interest and understanding how this interest can be fostered, may also eventually lead to a common language by the help of which researchers can more easily communicate across national and disciplinary borders. It is in such theory development that I see much of the force of present European consumer policy research when comparing it with, e.g., the U.S. The difference is not so much in terms of the results already achieved as, rather, in terms of the relative amount of effort going into the placing of consumer policy in a broader economic/ sociological/political framework.


Having thus divulged my hopes for more general theory, let me nevertheless end with a catalogue of some of the specific areas where I feel that European consumer policy research definitely lags behind. In every one of these areas there is a lag in relation to the urgency of the consumer problems and/or potentialities involved, in several of the cases there is also a lag in comparison with the state-of-the-art of North America research.

Consumer Co-Ops

In spite of the long and successful history of the European consumer co-operative movement, in particular in Scandinavia, and in spite of the recent failings of the co-ops in certain other European countries, it is surprising how small the academic interest has been in describing the necessary prerequisites for a cooperative movement to flourish, and in comparing the efficiency, in particular from a consumer perspective, of various forms of consumer economic co-operation. Some European countries have an academic tradition in the field, with a number of chairs as well as scientific journals about co-operation, but this tradition is somewhat sectarian, and mainstream economists and social and political scientists have more or less neglected this important institution both empirically and theoretically. In the last few years, a discussion has started, e.g., in the Nordic countries, as to whether or not the consumer co-ops are sufficiently different from private retailing and manufacturing industry to deserve classification as a "true" consumer organization; so far, however, this discussion has not been based on sufficiently thorough-going empirical investigations.

Local Consumer Groups

In my adopted home country, Denmark, local consumer groups have made a rather impressive entree upon the consumer policy scene in the last few years. They provide consumers in the local community with complaint handling assistance but also carry out small-scale surveys in the local market place, and sometimes rather fiercely protest against malpractices of local as well as national business. The spectrum of activities is very broad indeed; one often finds, for example, close relationships with environment protection groups. Public services are also scrutinized. It is my understanding that parallel developments have taken place in several other European countries.

In certain instances the local groups are in opposition to the national and federal consumer organizations, in other instances they become members of these very organizations. The groups, whose actual impact upon national consumer policy or business behavior should probably not be exaggerated at present, nevertheless constitute an interesting object of study since, in contrast to many national organizations, they have appeared as spontaneous public initiatives. They are examples of "self-organizations" of a kind other than, say, the independent product-testing organizations typified by Consumers Union. There would seem to be a rich harvest to be gained, both for consumer policy research and political and organizational science, from studying more closely the conditions under which such groups appear, how they function, their effects upon local business and government, and, in general, the strengths and weaknesses of these rather informal "countervailing powers." As mentioned earlier, there are in the literature descriptions of the fundamental difficulties of consumer self-organization; it would be interesting indeed to confront these theoretical derivations with the emerging phenomenon of the local groups.

Consumer Socialization

The person interested in this area will stand to gain very little from a perusal of European literature, as far as this reviewer can judge.

Consumer Education in Schools

This is an area in which much of researcher interest has been shown of late. Again, it would seem that within Europe, the West German literature is the most abundant -for an introduction, see Steffens (1978). Most of the literature in the field has so far dealt with the construction of taxonomies concerning the goals of consumer education, a discussion of the various didactic methods that can be applied, the production of case material for teaching, and the description of the content of consumer education courses and how they are incorporated into general school curricula. What seems pressing is the empirical evaluation of various methods of consumer education in schools. A recent but thus rather uncommon example of such a study is an experiment by Esser and Sarges (1979) which purports to show that consumer education - aimed at 11 year old pupils- has very little effect, at least if, as in the case at hand, teaching material is very cognitively oriented. (A rejoinder which questions both the data analysis and the theoretical interpretation of the results will be published in a forthcoming issue of the same journal.)

The Disadvantaged Consumer

Caplovitz (1963), and later studies in the U.S., as reviewed by Andreasen (1975), have attempted to demonstrate that in certain cases, the poor and disadvantaged consumer pays more, either in terms of price paid, or in terms of quality received for a fixed price. What about this phenomenon in Europe? One would envisage a lively interest in the topic, given the commitment of many a government agency to improving, above all, the lot of the "weak" consumer. It turns out, however, that not too much research effort has gone into analyzing, and, in particular, quantifying the amount of detriment suffered by the weak consumer.

The available data stem mainly from Great Britain, and the book edited by Williams (1977) summarizes a series of inquiries establishing fairly conclusively that poor people pay more for equivalent quality over a wide range of goods and services, but which do not, except very crudely, quantify the effect; the question of whether poor people also get worse quality for a given price is hardly approached. Scherl (1978) has reviewed the available West German evidence concerning the same matter; there seems to be much indirect evidence for the thesis that the poor pay more, but little direct, hard evidence. (In a specific sector, household energy consumption, Joerges 1979 present empirical evidence to support the thesis.) +lander (in press) has specified a series of hypotheses concerning the effects of income level upon the economy of buying, and has outlined some research designs aimed at studying some of the hypotheses, but his paper contains no data. It is to be hoped that more empirical studies of the weak consumer's situation will be forthcoming in a series of European countries, studies that would enable us to explore the importance of various contextual factors for the existence and size of the (presumed) handicap of low-income households in buying efficiency.

Evaluation of the Effectiveness of Consumer Legislation and Institutions

Most discussions so far to be found in the European literature deal with methods of evaluating consumer and market policy measures (see, e.g., Angelmar 1977; Biervert et al. 1977, ch. 4). One of the few more broadly conceived, empirical evaluation studies that I have located is the attempt by British researchers Morris and Reeson (1979) to estimate the costs and benefits of a local consumer advisory system, which comprised both the establishment and operation of a consumer advice centre for pre-shopping advice as well as complaint handling, and the recurrent dissemination of price comparison information. The authors conclude that in the case of the advice centres the benefits substantially outweighed the costs whilst in the price survey case the benefits appeared to be trivial. No doubt the method used in this exercise, and the estimates arrived at, can be debated. Nevertheless, as one of the first attempts to apply cost-benefit analysis to consumer protection policies, at least in Europe, it certainly merits attention and successors.

Negotiations with Industry on Behalf of the Consumer

In several European countries, much public policy-making and business regulation today take the form of negotiations between authorities and trade associations and/or individual firms- rather than law-making. The United Kingdom, in which the Office of Fair Trade encourages trade associations to draw up codes of practice which should safeguard and promote consumer interests (see Mitchell 1978a, and several articles in Mitchell 1978b), and Sweden would seem to be the foremost exponents of this new trend. In Sweden, the National Board for Consumer Policies negotiates so-called guidelines with industry which can deal with, e.g., product safety standards; the duty for sellers in particular trades to give certain information about their products; certain sales and promotion practices like mail order selling, direct mail advertising, etc.; and standard contract terms. In both countries, the agreements reached are not binding in a legal sense for the firms entering into them.

Very little is known, however, about how these agreements come about, and the degree of enforcement that is reached. It would seem that here we have a field amenable to several research approaches: studies of the actual negotiation processes and the bargaining strengths of the parties involved, evaluation of the effectiveness of the agreements, and studies- from the point of view of both law and economics - of the expediency of the negotiation institute when compared with more traditional law-making and regulation-setting. Comparisons with the procedures used for arriving at, and the results achieved by, the Federal Trade Commission's Trade Regulation Rules would also seem to suggest themselves.

Analysis of the Consumer Position in Specific Markets

Most discussions in the literature of the imbalance between the consumer and the producer position is carried out in general terms. Not much attention is paid to the fact that the relative strengths of the two parties most likely vary substantially from one industry to another. It is my belief that descriptions- for individual markets- of the relative power (or powerlessness) of consumers could both have more definite effects in terms of public policy, and through their stringency and concreteness provide more food for thought to builders of general theory. Attempts in this direction exist. See, e.g., the recent discussion in Sweden concerning the lot of the consumer in the sector of car repairs and the pros and cons of setting up an authorization system as a means of solving some of these problems (Larsson 1979). Another example is empirical studies intended to throw light upon the possibilities of constructing a food retail distribution system which is optimal for the consumer (Anell 1979; Arndt and Gr°nmo 1977; Widman 1979; Wikstr÷m 1978b). But in general, few attempts of this type appear to have seen the light of the day in Europe.

Consumer Problems in the Public Sector

The European organizations of consumers, and agencies for the education and protection of consumers, differ a lot as to whether they care for consumers also in their dealings with the suppliers of public services. It goes without saying, however, that as the production of public goods and services in most countries is becoming an ever increasing part of the total production, consumer problems in the public sector must grow accordingly- irrespective of whether they are dealt with by consumer organizations and agencies or not. For academic consumer policy research, then, it seems like an imperative task to discuss and evaluate various forms of consumer protection against, and influence upon, the suppliers in this sector.

It should be stressed that given the diversity and multi-disciplinarity of this particular problem area, a single reviewer is certainly overtaxed if attempting to make a survey of its research. Clearly, one would be able to locate studies of "consumer" public sector problems in the political science literature and in various specialized fields of public economics and policy- say, e.g., in transportation, health, or social welfare - although most of them would probably not be entitled consumer policy studies. The only fact that can be established with some certainty is that in Europe, little research on consumer problems in the public sector has been carried out by scholars characterizing themselves as consumer researchers and by means of applying, to the public sector, theories and techniques used in private sector research. A theoretically-conceptually oriented series of papers and comments has appeared in Journal of Consumer Policy (though with a majority of contributions by U.S. scholars, including the instigating paper by Young 1977). German authors (Scherhorn et al. 1975; Czerwonka et al. 1976; Biervert et al. 1977) have presented a collection of arguments for including in consumer policy research the relationships between the consumer/citizen and the public sector, among other things, the expediency of private versus public sector provision of certain goods and services. Empirical research building upon these proposals is still largely lacking, however. To mention just one conspicuous example, a thorough study of the results achieved by the consumer councils attached to the British nationalized industries would be an interesting exercise; for an introduction and survey of some available material, see Aird (1978).

Sharing of Experiences

Having now defined a series of research lacunae, I have to repeat the reservation from the beginning of the paper that it is of course impossible for a single person from a single country from a single discipline to know even the bulk of what is going on in multifarious Europe. There may exist important strands of research in the areas just listed of which this reporter is totally unaware. For the consumer's sake, let us hope that this is the case.

It is to those areas described as blind spots that the Journal of Consumer Policy has decided to give high priority in the next few years, and it goes without saying that the journal welcomes contributions from overseas in these very areas where North American research has often been more extensive and of a higher standard. This could help to prevent a most undesirable insulation of the scholarly activities on both sides of the ocean: In the underdeveloped area of consumer policy research, such insulation is a luxury which certainly neither side can afford.


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