This article analyses the effects of the innovative “philanthropic” initiative by leading shoe brands such as, TOMS and Sketchers. In this critical analysis, I would first focus on the term corporate philanthropy, and then discuss the overall effects and success of this “one for one” initiative.
First I would discuss corporate philanthropy. To regard such programs solely aimed at ameliorating underdeveloped communities would be naïve at best. We have to remember that businesses are still profit maximizing entities, thus such philanthropy exists to make the customers feel that their purchases are making a difference. This, consequently, increases the satisfaction received by the consumers, leading to increase in quantity of shoes sold. This can also be seen in an indifference diagram, change in preferences would shift the Indifference curve in such a way which would increase the consumption of shoes. More purchases lead to …show more content…
Because as said in the article the shoelessness is not reducing, this means that inflow of shoes is equal to shoes being discarded, and as the inflows include the donations, therefore they must be buying less. This is also shown in the fact that for every 20 shoes donated, people have bought one less pair. This effects are minimal but it tends to show the prevailing preferences of people. This shows that the program is not achieving its result of improving hygiene, because people have more pressing concern and the opportunity cost of buying more shoes is greater than spending it on other provisions.
The underlying reason for such behavior is people had more pressing needs to look after, such as ensuring a steady supply of food, than just buying shoes. The Maslow’s hierarchy of needs explains this phenomenon. It states that within the most important area of fulfillment, physiological needs, the person has to first ensure his sustenance and then comes everything
First I would discuss corporate philanthropy. To regard such programs solely aimed at ameliorating underdeveloped communities would be naïve at best. We have to remember that businesses are still profit maximizing entities, thus such philanthropy exists to make the customers feel that their purchases are making a difference. This, consequently, increases the satisfaction received by the consumers, leading to increase in quantity of shoes sold. This can also be seen in an indifference diagram, change in preferences would shift the Indifference curve in such a way which would increase the consumption of shoes. More purchases lead to …show more content…
Because as said in the article the shoelessness is not reducing, this means that inflow of shoes is equal to shoes being discarded, and as the inflows include the donations, therefore they must be buying less. This is also shown in the fact that for every 20 shoes donated, people have bought one less pair. This effects are minimal but it tends to show the prevailing preferences of people. This shows that the program is not achieving its result of improving hygiene, because people have more pressing concern and the opportunity cost of buying more shoes is greater than spending it on other provisions.
The underlying reason for such behavior is people had more pressing needs to look after, such as ensuring a steady supply of food, than just buying shoes. The Maslow’s hierarchy of needs explains this phenomenon. It states that within the most important area of fulfillment, physiological needs, the person has to first ensure his sustenance and then comes everything