Home loan seekers in the UK may now have to reveal their expenditure on food and drink, alcohol and tobacco. In a consultation paper titled Mortgage Market Review released this week, UK’s market watchdog, the Financial Services Authority (FSA), signalled it is looking to tighten the mortgage rules significantly. One, of the key causes that aggravated the financial crisis was “liar loans” or loans to people who self-certified their income in the absence of a salary statement—typically those who were either self-employed or unemployed.
Such loans were the first to go bad, since income had been overestimated in many cases. FSA proposes to get a better grip on the spending patterns of such people to ascertain their true incomes.
But knowing human ingenuity, FSA may need the services of garbologists to finally get a true handle on such consumption habits, because people typically will understate their expenditure on alcohol and food, considered morally lower than, say, fruit. A garbologist is an anthropology student of human trash. Garbologists tell us that not only are we what we eat, but also what we don’t eat. For a nation where many people are still fixated on a caste-linked waste disposal system that hinges on the accident of birth, the idea of 100 PhDs excavating, hand-sorting, measuring, and recording 30 tonnes of garbage from 15 landfills located across the US in an effort to understand people is a revolutionary one.
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The researchers did not let mountains of smelly discards, potentially hazardous, deter them from their purpose. The study was a part of the Garbage Project led by an American archaeologist, William Rathje, that aimed to conduct archaeological studies on modern refuse, and resulted in a book titled Rubbish! The Archaeology of Garbage. The term “garbology” was a byproduct of the study and is now part of the Oxford English Dictionary and Encyclopaedia Britannica.
The inferences of the study present some interesting insight on contemporary human behaviour. One, what we do and what we say are often different. People claim they waste little food while being quizzed, but an analysis of their trash showed that “households generally waste about 15% of the solid food that they buy.” Given that this research was carried out after taking consent, people knew that their garbage was going to be examined, yet they understated food waste and alcohol consumption. Two, this mismatch between action and behaviour follows a pattern. For example, drinkers consistently under-report their alcohol consumption by 40-60%, but teetotallers in the family will report accurately the quantity of the beverages consumed.
Three, human behaviour is often irrational, something that behavioural economists will vouch for. The study documents the presence of increased levels of beef waste during the media-hyped “beef shortage” in 1973 in the US. Reasons for this were hoarding of beef and using cuts that were cheaper and both getting wasted. The same behaviour was seen during the sugar shortage in 1974, with sugar products getting wasted more than before. Any public panic will trigger panic buying, a large part of which ends up in the morning black garbage bag. Four, the less food use behaviour varies over time, the less food is wasted or, if we stick to the familiar foods, we waste them less. The study found that the common sliced bread, which is usually consumed at one or more meals a day, was wasted less than 10% of purchase, while less-frequently consumed speciality breads such as hotdog rolls were wasted more than 35%. Which is why, says the study, “Hispanics waste less food than Anglos—they have fewer basic ingredients than Anglo diets.”
I was introduced to an Indian garbologist some years ago. His fascination for the subject and its study led him to incubate a waste recycling project at the Indian Institute of Technology (IIT) Delhi that has now morphed into a not-for-profit called Indian Pollution Control Association (IPCA). His wife told me a fascinating story of how they spent one wedding anniversary dinner talking about garbage. Other than being slightly obsessive about garbage, garbologists may not be great guests to have over for dinner. You might find them examining your bins carefully or even observing who leaves what on their plates as waste, all the while secretly making notes under the table. My garbologist friend adds this from his current location in Australia: “People hate you for looking into their trash.” Because what you throw away tells a story about what you consumed the day before.
Monika Halan works in the area of financial literacy and financial intermediation policy. She is consulting editor with Mint and adviser, Pension Fund Regulatory and Development Authority, and can be reached at email@example.com