Bow Wow & Meow
The economics of pets and their owners
By ALLEN R. SANDERSON
More than 60 percent of American households provide room and board
for at least one pet. More families own dogs than cats, but given that
the typical feline family is likely to have multiple kitties, in sheer
whisker count cats outnumber dogs.
In addition to significant
time commitments, these creatures are expensive propositions. Thus it is
not surprising that a higher percentage of U.S. households have pets
than in less wealthy countries. (40 percent of the world’s dog and cat
populations may reside in the U.S.) Owners spend far more on their
pets—food, vet bills, toys, boarding, replacing furniture, neutering,
and ultimately burial—than we allocate to other recreation or
entertainment items.
There are unmistakable signs that when it comes to pets, demographics
and the economy matter. (The largest single category of cat owners:
divorced women in their 40s or 50s.) As baby boomers age and become
empty-nesters, animals will replace children and become like members of
the family. Wal-Mart and grocery chains are well aware of these trends
and are devoting more shelf space to pet care; and as we are
increasingly likely to take our pets on vacation, hotels/motels are
becoming more accommodating. Pets are not immune from the business
cycle—witness more abandoned animals in recent years and trading down
from Iams kibble to generic alternatives—but spending on them may
fluctuate less than for many goods.
As a society we have great affection for animal movies—Lassie, 101
Dalmatians, Bambi, Old Yeller, Babe, The Lion King, Milo & Otis,
Kung Fu Panda—and we even take a personal interest in presidential
pets—“First Dog” Bo or “First Cat” Socks. (Fifty years ago Richard
Nixon’s address about alleged fund-raising improprieties became known as
his Checkers Speech, owing to his reference to the family dog.) We are
touched by feel-good news stories of animal rescues, and we recoil at
accounts of neglect and abuse (think Michael Vick). Our vocabulary is
enriched by phrases such as “raining cats and dogs,” describing a
situation as a “cat fight,” or claiming that a dog is man’s best friend
(girls arguably got the better companion: diamonds).
And what do we get for our outlays? Are our pets “friends with
benefits”? Economists would separate these questions into three
categories:
First, presumably these pet owners—or guardians in politically
correct language—weighed the costs and benefits, and reached a
conclusion that for companionship and/or child development, plunking out
good money for Fido or Oscar is worth it, not unlike owning a boat,
travel, or any other hobby. In this regard, society has no stake in this
private decision. In rural areas, and in earlier eras, dogs and cats
also served to herd sheep or as mousers. Now they are more what
economists would call a consumption good rather than a production good
(the same is true of children).
Second, dogs, more than cats, can also constitute, in economic
jargon, negative externalities. They bark, can bite, and use others’
yards and public spaces as personal rest areas. Thus municipalities may
enact leash laws and mandate that owners pick up after their pooches
(were there such a law for teenagers!). And to reduce the number of
strays, they may either require spaying or give a discount on licenses
for neutered animals.
Of course, again dogs more than cats, pets can also be what
economists would label positive externalities. Traditionally we think of
barking that wards off intruders as one such instance: burglars avoid
neighborhoods with dogs. In addition, there is strong evidence that pet
owners are not only happier because of their lifestyle choice; they are
also healthier (lower blood pressure, less stress, speedier recovery
from illness) and thus make fewer demands on society’s medical
resources, hence another positive externality. Whether dogs and cats pay
for themselves—that is, reduce an owner’s health-care bills more than
they cost to maintain—is an intriguing, and likely answerable, question.
Finally, the old saw that people start to resemble their pets may be
tipped on its head: In many cases nowadays, pets resemble their
owners—they’re getting fat! Due to overfeeding and a lack of exercise in
high-density urban environments, more than half of the nation’s dogs
and cats are overweight, and one in five is clinically obese. Just as
Americans are overeating and under-exercising, these traits are being
transferred to our non-human companions. So the next time Buster wants
to go for a walk, or Felix wants to play, perhaps we should take the
hint.
Published: June 10, 2012
Issue: Summer 2012 Issue