However, when people give up expensive goods such as buying a house, buying a car and traveling abroad, people will spend their spare money on the substitutes of those expensive goods-"cheap unnecessary things", which has a substitution effect. This substitution effect is far greater than the income effect of reducing consumption due to the decrease of income, so the lipstick effect is produced.
Extended data:
Enlarge the "lipstick effect" of cultural industry;
Cultural consumption has lipstick effect. Generally speaking, when the economy is depressed, people's material needs will shrink, while spiritual and cultural needs will expand. When it becomes difficult to buy a car and a house, people will turn to relatively cheap consumption. Cultural consumption can not only meet spiritual needs, but also meet their tolerance, which may become a large-scale demand. This effect is called "lipstick effect".
At the beginning of this year, the box office of New Year films exceeded 500 million yuan, showing a blowout growth, which is an example. Tencent's value-added service revenue was 5 billion yuan, up 95.5% year-on-year, and the number of active users of "QQ Space" exceeded 200 million, which is another example.
Secondly, from the historical experience, the period of economic crisis is precisely the golden age of cultural industry prosperity. In the late 1920s, an economic crisis broke out in the United States, which triggered the Great Depression. But at the worst time of the economy, the film industry has ushered in development. During the Asian financial crisis, the cultural industries in Japan and South Korea once again confirmed this rule.
Japan's animation industry, electronic game industry, South Korea's film and television drama industry and online game industry have risen rapidly and become pillar industries.
Baidu encyclopedia-lipstick effect
People's Daily-People's Times Comment: Enlarging the "Lipstick Effect" of Cultural Industry