Chapter 1: Introduction – Consumption and Management

1

Introduction

Consumption is a holy power.

Consumption creates everything in human society. It deserves a high position in society because of its holiness.

Consumption is the permanent focus in economics which draws attention not only of the economic circle and of economists, but also of the national functional departments and decision-makers. The mechanism of consumption shows that the operation of consumption has decisive significance for a wholesome national economic operation and its efficiency.

Consumption is the beginning and end of the economic development cycle, as well as the sum of all human activities. It is the sum of awareness, understanding, thinking, thinking pattern, and consumption awareness acted upon human brains by three important consumption practices. It is not only a conclusion of academic theories but also a product of theory and practice. We can say that this is a new revolutionary systematic theory of consumption.

This book is about the systematic theory of consumption science. It is a comprehensive study of the origin, development, classification, principles, application, and other systematic theories of consumption; it researches the origin of natural science and social science and concerns a great number of subjects, for example, philosophy, history, economics, management, leadership science, marketing, and merchandising. It is a large-scale multidisciplinary and academic work of penetration and integration.

Consumption is the sum of all the human activities. There is no society without consumption, no economy without consumption, no human-nature relations without consumption. Therefore, to guide all the scientific research of human beings and direct the consuming practice with consumption is the base of academic theoretical research. It is the starting point, foothold, and destination.

Subject definition

Human consumption is the sum of the whole consumption process that is driven by the metabolism instinct to obtain material from nature, then to create new needs and desires by human knowledge, and further to create new material products (including the spiritual culture). It includes the definitions of narrow-sense and broad-sense consumption. Consumption and Management puts consumption in the broad background of human social science and natural science. It studies the social position, social roles, and function principles of consumption. It is a science that focuses on the practice and function principles of production, living and social consumption.

At the same time, Consumption and Management deals with the relations between human consumption and nature, human consumption and economic development, human consumption and social civilization and progress, human consumption and consumption practice, as well as human consumption and consumption awareness and action.

The ladder structure

These are the levels of the ladder structure:

• the systematic theory of structure consumption science;

• the three important consumptions of constitutional structure;

• the sub-system structure of each consumption system

• the detailed classification of the sub-systematic consumption (the detailed classification is left out)

• the leadership management during the practice of three consumptions.

Three important consumption systems

In the three important consumption systems, scientific research and production consumption are the premise of the realization of living consumption and social consumption. Scientific research and production consumption can be divided into three sub-systems:

• the scientific research and production consumption for the realization of living consumption – the scientific research and production consumption which satisfies the increasing material and mental consumption needs of humans – the consumption realization of capital’s commodity production and exchange management process

• the scientific research and production consumption for the realization of social consumption – the scientific research and production consumption which satisfies the increasing material and mental consumption needs of society

• the scientific research and production consumption of basic industry which bases itself on the first and second sub-systems.

The realization of a continuous increase in living consumption, social consumption, and research and production consumption requires the development of the country itself. Only with continuous growth in productivity can the country promise the three important consumptions to promote the natural cyclic development of economy. Research and production consumption derive from consumption; research consumption is the production consumption for new knowledge and new techniques which constantly creates new consumption needs and consumption desires. It creates new consumption commodities for living and social life, and new consumption patterns, and pushes the development of new consumption levels.

Object of study

The research subjects of Consumption and Management are three important consumption systems (shortened as three systems) of humanity’s living consumption, scientific research and production consumption, and social consumption in light of human consumption.

Consumption and Management regards three systems as its main research objects and researches on the general rules and all the relations such as the relations between consumers; relations between consumption and demand; relations between consumption and commodity exchange; relations between consumption and distribution; relations between consumption and management; relations between consumption and nature; relations between consumption and the development of human beings; relations between consumption and human wealth; relations between consumption and productivity and production relations; relations between consumption and economic base and superstructure between the three systems and social activities in the perspective of human consumption. It tries to figure out the basic natural rules, market regulation rules, and macro-control rules of how consumption affects economic development, as well as the general and specific rules in developing the process of all kinds of economic relations.

Tasks of the subject

The basic research tasks of Consumption and Management are to use Marxist consumption theory to summarize the experience of consumption practice, to make clear the position and functions of consumption in social reproduction, to increase people’s consciousness to know and use the consumption mechanism and rules, to put the understanding of the consumption on a systematic, theoretical, and scientific basis, to study and borrow the general doctrine on consumption at home and abroad, to better master and apply consumption rules, to supply the scientific foundation for development of the strategic goals of national economy and the consumption plan, principles, and measures for the realization of these goals, to propose a scientific basis for the rationalization of the industrial and product structure of national economy, to cultivate talents, and to push the development of productivity of consumption society and the development of social civilization.

By making clear the consumption mechanism and its movement principles, Consumption and Management attempts through:

• research on the internal connection between consumption, production, distribution, exchange and consumption by consumers, to discuss the nature of consumption and features of socialism with Chinese characteristics under the premise of a market-oriented economy, and its position and function in cyclic national economic development

• the internal connections and interactions of consumption and economic development, to discuss the decisive function of consumption in promoting economic growth as well as the internal connection between consumption and industrial structure adjustment

• research on the internal connections and interactions among the needs of consumption, consumption structure, consumption pattern, and consumption level, to discuss the movement, general principle and effect-evaluation standard of consumption

• research on the interactions among the needs of consumption, consumption structure, consumption pattern, consumption level and their changing trends with superstructure, to discuss the conditioning and direction of national development strategies, principles, policies, plans and regulations for consumption

• comparative research on consumption theories and practice of China and foreign countries, to draw on the experience of domestic and foreign new research results on consumption and discuss the general mode and rules of consumption movement

• research on consumption activity and principles of consumption chain, to discuss the consumption psychology, consumption behavior of consumers and their families and their influence on social economic basis and superstructure

• research on the relations and rules among consumption and nature, scientific research and production consumption, distribution, exchange, consumer’s consumption process.

Aims of the book

The researching aims of Consumption and Management were to meet the needs of increasing human material and mental consumption, scientific research and production consumption, and social consumption to build harmonious and peaceful social relations and living environments for human beings. At the same time, the book will help people to adapt to the natural rules during the economic development process and obtain the happiness of human beings and a harmonious coexistence with nature.

The research work in Consumption and Management is based on cross-cutting penetration, integration, promotion, and co-development of philosophy, sociology, economics, management, leadership science, marketing, finance, and other natural sciences. It researches the productivity of consumption society from the perspective of the consumption of human original basic need and proposes 15 factors of consumption society mechanics. Economy, society, culture, and the developing process of human beings all belong to the sphere of research.

The breakthrough point of the research is to divide human consumption into three systems – living consumption, social consumption, and scientific research and production consumption; it discovers that this three-fold system is the rule that promotes the cyclic development of economy and the natural rule of economic development – the production and exchange of commodity run through the needs of three important consumption systems and create market-free (natural) financial and economic laws (Adam Smith called it ‘an ‘invisible hand”). After research, we find that it is a visible hand and can be understood and controlled. It has great active and positive functions as well as negative ones. It is the natural solution for micro and macro supply-demand contradiction of the unity of opposites. The principal aspect of the contradiction is the great active functions in market-free (natural) financial and economic process. The secondary aspect is the negative functions. In times of financial or economic crises, the secondary aspect will become the principal aspect, which will greatly harm the economy.

The solution of the contradiction is to stick to nation-centered economy and the living consumption-oriented macro market regulation system (composed of six aims, three means, and twenty factors), to continuously exercise the regulatory loop of imbalance to balance and balance to imbalance in the process of the three important consumptions. It is also necessary to guarantee the smooth development and function of the natural principles of three important consumptions in the macro market regulation process so as to ensure the increasing material, mental, and cultural demands of people.

Research methods

The Consumption and Management employs scientific research methods. The most outstanding one is that the author combines his practical experience closely with his theory at all times, especially his revolutionary method of tracking down the origin of consumption. He inspires new ideas through continuous theoretical study and abundant practice for 60 years, and extracts the essence of his practice to build a theoretical concept, which is full of descriptive and explanatory features. The five concrete research methods in Consumption and Management are discussed below.

The philosophical method

This method includes dialectical materialism and historical materialism. The philosophical thinking runs through Consumption and Management. A great number of analyses of the economic and social problems are based on philosophical wisdom.

The qualitative and quantitative analysis method

The Consumption and Management uses both qualitative and quantitative analyses. Based on the statistical data, a mathematical model is set up to analyze the indexes and their values. The method judges the nature, features, and developing regulations of the object through the instinct and experience of the author, as well as the past and present conditions and the latest information of the objects. The two methods are used alternatively in Consumption and Management.

The systematic analysis method

Consumption and Management regards consumption as a system and gives integrated analysis to the systematic factors to figure out the applicable solution for the problems. It investigates and researches the human consumption process using the perspective of a system. In the research mentioned in Consumption and Management, it always regards consumption as a complete and complex system so as to avoid one-sidedness.

The investigation and research method

Many conclusions in Consumption and Management are based on on-the-spot investigations, the usage of basic theories and research on internal rules of consumption. Another feature of this book is that it pays great attention to sampling survey and typical investigation, so the data in the book are reliable and the conclusions are correct.

The comparative research method

Comparative research methods are used a lot in Consumption and Management. The methods include theoretical comparative research, management comparative research, marketing comparative research, cross-cultural and cross-discipline comparative research, and so on. The vertical comparison in Consumption and Management focuses on the comparative analysis of the same comparable subject – consumption in different situations with different characteristics in different periods, and the horizontal comparison in the book focuses on the comparative analysis of the different consumption conditions and characteristics in the same period. Through the vertical comparison and horizontal comparison, readers can understand consumption – the core topic in economic and social development – from different angles.

Research formula

The research formula in Consumption and Management is consumer consumption –> scientific research and production consumption –> distribution consumption –> exchange consumption –> consumer consumption:

1. Consumer consumption creates scientific research and production. The process of scientific research and production is a process of consumption. Commodities as well as the consumption pattern and level of consumptions are generated in production.

2. Science and technology is the capability which transfers into the productivity of a consumption society during the production process; it is also the valuable wealth of new technical products which are consumed by direct consumers and realize the productivity of a consumption society on the market exchange process.

3. Distribution consumption is a distribution policy decided by the social system and national law; it is a method deciding how the social members acquire social wealth and the amount of wealth they get. It decides the consumption power, the consumption and its level of the social members. Distribution includes the distribution of production output, salary or profit sharing, and the redistribution of social wealth after tax.

4. The exchange consumption process is one part of a product’s value. The production exchange process is a consuming process. The dealer who takes part in the product exchange serves as the bridge between producer and consumer. Only through exchange can the final consumption of a commodity be realized. This is a rule that develops by consumption, which leads the cyclic development of economy. Its performance on the market is the free (natural) market financial and economic adjustment rule. The free (natural) market financial and economic adjustment rule has an important active function as well as a serious negative function. A national superstructure should control this rule on the macro level and ensure a continuous and orderly development of economy following the spiral loop of imbalance to balance and balance to imbalance.

5. Consumer consumption is the destiny of the production; a commodity is consumed by direct consumers so that the aims of scientific research and production and the value of productivity of a consumption society are realized. The consumption needs of consumers are developing and unlimited.

Theoretical references

Consumption and Management is a gathering of domestic and foreign theories about consumption. In order to write this book, the author studied and researched numerous Chinese and foreign economists’ theories concerning consumption. He obtained penetrating statements and unique ideas of these economists and drew their essence from them, which is a very important basis for the formation of this book. We can say that the author could not have written this book without the work of these predecessors. These theories mainly include:

• consumption theories from the traditional Chinese culture, including the consumption thoughts of Confucius, Lao zi, Mo zi, and Guanzi

• references from Western economic theories, including Adam Smith’s An Inquiry into the Nature and Causes of the Wealth of Nations, Keynes’s The General Theory of Employment, Interest and Money and Samuelson’s Economics

• references from Marx’s consumption theory, such as Capital

• references from Deng Xiaoping’s consumption thought, mainly including Deng Xiaoping’s consumption strategic goal, the strategic focus of consumption and consumption policy and so on.

Major academic purposes of this book

To endow consumption with a lofty academic position

Discovering the value of consumption as well as endowing it with a lofty academic position is one contribution this book makes to Chinese economic theory research.

Consumption and Management is not only the first comprehensive treatise on consumption from the multi-disciplinary viewpoint in China, but also the first book regarding consumption as the basis of economic social research. The book researches consumption from the perspectives of economics, management, and marketing, as well as from the angles of philosophy, culture, and history. With systematic scientific theories, the book regards consumption as a complex dynamic system and uses the methods of qualitative analysis and quantitative analysis to describe the position, influence, and decisive significance of consumption in the economic field and whole of social life.

Consumption is the starting point as well as the end of production. Consumption –> scientific research and production –> distribution –> exchange –> consumption is a motion law as well as a logical process. Consumption is the motive of production; the scientific research and production process is also part of consumption, which produces commodities and creates new consumption needs and new consumption patterns. Consumption decides everything. We can say that these academic thoughts discover the essential characteristic of market-oriented economy from an academic viewpoint.

To propose new consumption classification

Traditional classification of consumption includes production consumption and living consumption (not including mental and cultural consumption). Consumption and Management divides consumption into three categories – living consumption, scientific research and production consumption, and social consumption (including mental and cultural consumption). Social consumption refers to public consumption in terms of state administration, national defense, research, education, public security, justice, aviation, aerospace, and scientific exploration. Compared with the traditional classification, the new one moves further and is creative.

Traditional economics divides the social production process into four sectors: production – distribution – exchange – consumption. Production is the most basic sector, which decides not only distribution and exchange, but also consumption. The variety, quality, and quantity of products which are produced by social production decide objectively the target, structure, and pattern of consumption. There is no consumption without production.

In fact, consumption is both motive and purpose in production and reproduction. Consumption decides production; the products which are produced in production are consumed in the commodity exchange process by consumers so as to realize the purpose of production. So consumption decides everything.

To discover and elaborate three rules

Consumption and Management discovers and elaborates three rules: natural economic law, market regulation law, and the law of macro-economic control.

Natural economic law refers to the natural rule (mother rule) that three important consumptions drive the cyclic development of economy. It means: consumption – market – demands (increasing consumption needs of desire – recognition – knowledge and inspiration – recognition) – scientific research – production – consumption of higher level. It is a natural economic law of spiral movement.

The market-adjusting rule says that currency appeared during the moving process of humanity’s practice in three important consumptions systems and the commodity production and exchange process. The developing process of currency produces the economic law of financial enterprise and the law of natural (free) market economy. This rule is not an ‘invisible hand’ but a rule that can be recognized and controlled. Currency and its financial instrument decide the production and exchange of capital, and consumption produces the consumption chain (consumption value chain) – macro consumption value chain and micro consumption value chain – during the commodity production and exchange process of capital.

Natural (free) market economy rules and natural (free) rule of financial market are twin sisters who depend on each other but are not the same as each other.

The macro-market regulation rules of the state-led economy that centered on the living consumption refer to the idea that since the superstructure of national system and government are the representatives of the overall economic foundation, overall production relations, overall productivity, overall ideology, and rights and consumer’s benefits of all the citizens. The responsibility and right of superstructure is to serve and protect the consumption benefits of all the citizens. Therefore, the nation should dominate the economy; the national macro-control market should be living-consumption-centered so as to give full play to the positive functions of the rule and prevent and overcome its serious negative functions.

To suggest a consumption-economy-centered macro-control adjustment system

According to Consumption and Management, market self-adjusting economic law is a tangible rule which should be recognized, researched, and controlled by the national government. The government should make full use of its positive effect and restrict its negative effect. So the macro-adjustment system of a nation is composed of three parts: economic measures, legal measures, and administrative measures.

The research in Consumption and Management begins from the origin of human consumption. It concludes with the experience and lessons of economic development in human society, especially the experience and lessons after the first financial economic crisis in the world. It also draws a conclusion on the experience and lessons during the social development process of planned economy and socialistic market-oriented economy with Chinese characteristics: ‘National government should dominate the economy with a living-consumption-centered financial and economic macro adjustment rule.’ It is composed of six aims, three measures, and 20 factors. The cycle of imbalance to balance and balance to a new imbalance will be focused in the systematic dynamic movement, and development of the consuming market economy rules will be macro adjusted continuously. This requires that the national leaders put their subjective initiative into full play in using the country elements, comprehensive national power, and the national management functions to realize scientific development in practice, prevent serious periodic financial and economic crises, and push the continuous development of social civilization.

To put forward the important statement of productivity of consumption society

Nobel Prize winner Robert Mundell (Professor of Columbia University in the United States, the winner of the Nobel Economics Prize in 1999) believed that productivity of consumption was the important statement in the 21st century, which had great influence on China and the world, as well as crucial theoretical and practical significance for promoting the virtuous cycle of China’s national economy and establishing a harmonious society.

The productivity of a consumption society is an important branch science of Consumption and Management. It makes a statement on the practice process of the three important consumption activities from the point of view of consumption, from the level of macro to micro, from the level of the relations between consumption and nature, from the level of consumption and philosophy, from the level of consumption and society, from the level of economics, from the level of natural science, from the level of consumption and distribution, from the level of the commodity production and exchange of science and technology and capital, from the level of consumption and macro management (the level of enterprise marketing management), and from the level of consumption and micro management (the level of financial management of family consumption).

Consumption and Management points out that the pulling force of the productivity of a consumption society on the economic increase is embodied in the new production needed by consumption and supplies the impetus and purpose for production. New needs for related products are created during the consumption process, which supplies new requirements for production and impetus and purpose for reproduction, so there is no production without consumption demand, and the production should be processed according to the consumption needs, which is typical in a market-oriented economy. Taking consumption as the pulling force includes the creation of consumption and creation of consumers’ new needs.

To point out the way of transferring economic increase

Consumption and Management points out that production is the foremost means and avenue for social life under a planned economic system, while consumption is the foremost avenue under a market-oriented economy. The shortage of commodities in a plan-oriented economy arises for artificial reasons, while the market-oriented economy can satisfy the changing needs of the three important consumptions. So, only by putting consumption first, and taking consumption as the most important driver of the national economy, can the market-oriented economy be realized.

In recent years, the scale of social consumption investment has become very large. If the scale keeps developing, then the scale of social consumption investment will continue to increase in the tenth Five Year Plan. Some experts estimate that if the present investment ratio adds 1%, the GDP of China will increase by 0.22 of a percentage point; if the citizens’ consumption ratio adds 1%, the GDP of China will increase by 0.87 of a percentage point. From these data, we can see that the living consumption contributes much to the economic development, and we should pay more attention to the proportional relations of the three important consumptions.

History has given us an important signal that China has entered an era in which living consumption has become the main pulling force. From the national macro direction, we can say that China has entered the living-consumption-oriented economic developing era. This phenomenon will not change whether politicians, thinkers, and economists notice it or not. For how many years will China have the two-digit developing rate? In the book, the author does not consider that social consumption investment, import–export consumption and living consumption have the same importance. Living consumption is the most important, while the other two are of minor importance. If we can control living consumption, we grasp the key point. At the same time, the author points out that China has a potential investment environment and boosting domestic demand is the great impetus to the continuous development of China’s economy. This is the academic direction of this book.

To deepen the labor value theory and new classification of labor

Labor value theory is the very foundation of Marxism as well as one of the basic theories of political economics. Value is created by abstract labor and living labor. Labor is the source of value. This is the basic content in labor value theory and is a scientific proposition:

• Consumption and Management deepens labor value theory and gives a new definition to productive labor.

• Consumption and Management endows the new concept of ‘labor consumption value’ to human labor and makes a new classification of it.

The classification in Consumption and Management breaks the simplification of traditional classification of labor. It sets a more concrete premise for studying the new socialistic concept of labor and proposes a standard for judging and weighing labor value. When we judge a kind of labor, we should notice whether it produces surplus value, whether it benefits people’s health, and whether it plays a positive role on social life. This is the standard of labor value for producer’s reference.

To inherit and develop the traditional philosophical theories

The definition of philosophy

Consumption and Management proposes for the first time a new concept of philosophy: philosophy is the highest level and method of human thinking in understanding and reforming nature, the wisdom crystallization of natural and social science, and the expression of awareness and wisdom at the highest level.

Philosophy originates from human practice process on relations of nature (matter), three important consumptions and nature, as well as the reaction process of human brain. Thinking, thinking process, cognition, consciousness, consumption awareness, and wisdom are created through the human brain’s instinctive function (to discover and receive information, foster impressions, memorize, store, process, create thinking and thinking processes, and output information), and then act on three important consumptions of human beings. It is a process of discovering, creating, accumulating, inheriting, and developing, and also an infinite development process in circular spirals. Therefore, discovery, knowledge, and inspiration (creative thinking) recognition is the core of the philosophy.

Consumption consciousness

Driven by the instinctive consumption of metabolism, mankind obtains materials from the natural world, and then creates new needs and desires continuously with human intelligence, the total sum of the whole process of consuming material (including the spiritual and cultural) products and three important consumptions; this process makes mankind connect with nature. During the practice of three important consumptions, human beings constantly learn the relations of man and nature and of different individuals to understand themselves.

Consumption and Management proposes and demonstrates the regularity of ideology and the regularity of solving the contradictions in the developing process of ideology. It points out the differences between ideology and ideological methods, universality of effect of the seven ideological methods in common sense on three important consumptions activities, and the cyclic law of imbalanced to balanced, balanced to imbalanced in the development of unity of opposites.

The book perfects the motion relations of philosophy and three rules and regards unity of opposites as the common rule in the practicing process of all the things. It points out the motion law of partial qualitative change to total qualitative change and mutual transformation of quality and quantity. It believes that negation of negation should be changed into negation of affirmation because negation of affirmation is more scientific and practical. These two rules are the internal motion laws of unity of opposites and do not have equal position.

The spiral development law of cognition

The general law to perfect cognition refers to a development process of discovery – > feeling – > apperception – > impression – > knowledge – > knowledge (thinking and understanding) – > inspiration – > experience – > experimentation – > summarization – > abstraction – > reasoning. Knowledge exists throughout the process of cognition. Inspiration is the creative thinking while experience and experimentation are scientific means to learn about nature; there will be no innovation and creation without knowledge, inspiration, experience, and experimentation. Moreover, the spiral development law of cognition was put forward.

Consumption as the motive for the development of social civilization

Human consumption means the sum of consumption process. From birth, human beings are compelled by instinct to consume, and ask nature for consumption materials, and human wisdom produces new demands and desires to produce consumption materials. Over the long history of mankind, family, nation, tribe, private ownership society, and country came into being. And along with them is the consumption need which promotes three major industrial divisions in human history.

Family is the main body of living consumption and production consumption; after the detailed division of labor in production consumption, especially after the detailed market division of the production and exchange of capital products, family becomes the main body of living consumption while it is not the combined body of living consumption and production consumption. The smallest cell in society is family. Family is a social cell as well as the consuming cell. Society is made up of families (including the one-person family). Family is a family of consumption, so society is a society of consumption. There is no individual, family, nation, party, community or country without consumption.

Consumption creates human society and production. The production and consumption processes create class and class contradiction. The severe unfair distribution of consumption wealth leads to the class struggle in society.

Consumption leads to war because war is also a kind of consumption. War is regarded as the source of all evils, but it has the roles of building country and liberating the productivity of a consumption society, as well as pushing the development of social civilization.

Consumption creates new producing technology. New high-technology transfers into the productivity of the consumption society and produces products with new technology and high technology. Social civilization develops during the consumer’s consumption process.

Thus, consumption is the power source for the development of social civilization.

To introduce knowledge and inspiration into epistemology

Epistemology is a long-discussed issue, the science of the initiation and development process of human cognition as well as its laws. It focuses on sources of people’s consciousness, cognitive ability, cognitive form, cognitive nature, the structure of cognition, the relationship between objective truth and cognition, and so on. In modern philosophy, especially contemporary philosophy, epistemology gains more and more importance. In the development history of epistemological thought, every introduction of a new important concept is to initiate great academic change. Throughout the history of Western philosophy, in general there are three major philosophical revolutions caused by the introduction of new concepts:

• Plato introduced ‘logos’ into epistemology, which forms the first transcendentalism.

• Immanuel Kant introduced ‘psyche’ into epistemology, which causes great revolution in the history of philosophy.

• Marx introduced practice into epistemology, which brought another major change in the history of philosophy.

Fourth, Consumption and Management introduced knowledge and inspiration into epistemology.

‘Consumption practice and consumption awareness’ in Consumption and Management is summarized below.

The process through which people develop cognition can be divided into the following three stages:

• The first stage is to observe, discover, feel, apperceive and foster impression (presentation), namely the stage of perceptual knowledge.

• The second stage includes knowledge, inspiration, experimentation, thinking and judgment, which means to try the experience out and learn from the lesson, i.e. the first phase of rational knowledge. This is the basic stage of human practice, the foundation of the formation of rational knowledge.

• The third stage is to summarize and reason abstractly, i.e. the highest rational stage of thinking, concept, viewpoints and conclusion.

Theory of consumption introduces knowledge and inspiration into epistemology. It will be emphasized that the introduction made by the Consumption and Management is not a reference in a general sense but is regarded as an essential link of epistemology. Having knowledge and inspiration admitted to epistemology gives two aspects of significance. For one thing, knowledge is an important quality of modern people, needed by those who want to achieve something and which they must keep developing and improving. For another, it is imperative to cherish knowledge and respect inspiration from the point of society, and to realize that knowledge may bring a better and more special thinking process to individuals, organizations, or even the whole country, while inspiration perhaps implies one or several significant inventions.

To propose and enrich national factors, comprehensive national strength, national management function, enterprise management law, and management factor

Country elements: territory people legal national ruling power system superstructure system legal system.

Comprehensive national strengths: national resources economic strengths cohesive force of people’s will productivity level of consumption society military power degree of state development diplomatic strength control capability of government. The organizational and control capability is the core for organic combination of the government system as a whole. Without such capability, none of the strengths will be able to take effect.

The 18 elements of national management stand for the factors the national superstructure adopts for macro management with correct thinking and thinking methods, leadership approach and leadership art. The purpose is to improve the labor efficiency of the state managing officials, to realize the low consumption cost for macro consumption, so as to achieve a relatively high level of management objective.

Enterprise management is a systematic management. The outer environment of the enterprise is the living condition for an enterprise and the management of the outer living conditions is a kind of management of public relations. Management of enterprise connotes the inner part of the enterprise management. Only by linking the inner and outer managements together with systematic organic management can a lower scientific research and production consumption cost be achieved and more qualified products with use value be produced. The consumption cost is reduced during the marketing process, the preference of consumers can be acquired, scaled sales can be realized, the best profit effect and social effect can be achieved, and the best value of a narrow sense of productivity of consumption society can be realized.

To put forward leadership management theory

Leadership management science develops from general management, management science, operation research, and systematics. The research focus of general management and management science is on management, and seldom emphasizes the function of leadership in management; leadership science focuses on leaders and seldom emphasizes the management function in the systematic activity process of leaders. So, management science and leadership science are both one-sided. Leadership science combines the opposites of leaders and subordinates; both the leaders and the subordinates are management objects, and leadership management involves the coordination of the whole system; it studies the common target, united ideology and management in the striving movements of leaders and subordinates, as well as the general and specific rules of leader’ power, authority, responsibility, benefits, functions, and the relations between leaders and subordinates in the systematic process.

There is no leadership without the management of three important consumption practices and no management without leadership in human history. There is no leader without subordinates, no leader without decisions and management under a common goal in certain conditions. Leaders and subordinates are all managing subjects, and leadership management activity is an undivided unity of opposites. The leader is the main contradiction and the main aspect of a contradiction, while the subordinate is the secondary contraction and secondary aspect of a contradiction. When the main contradiction cannot suit the secondary contradiction, the contradictions will interchange – a new leader will appear.

In the third chapter of Consumption and Management, more than 160,000 words are dedicated to the detailed description for leadership management.

To give a comprehensive research and study on the internal rules in consumption and management

Leadership management science can be divided into macro-consumption leadership management and micro-consumption leadership management. Macro-consumption leadership management is the overall management of a national superstructure and government of three important consumption activities. Micro-consumption leadership management includes the marketing consumption management of enterprise production consumption marketing and exchange marketing process of market-consumption products, and the financial management of household living consumption.

Macro-consumption leadership management

National management law: the nature and scale of a country’s system decides the national management mode.

National macro-consumption leadership management involves authorities with responsibility and national superstructures – comprehensive national strength and 18 factors of national management function – organically functioning by way of proper analytical logic, ideological, and leadership measures. Macro-consumption leadership management can increase the working efficiency of national managing officials and realize low consumption levels of macro consumption, so as to achieve high-level management.

Micro-consumption management

Enterprise management rule: production art decides the production mode; the production mode decides the management mode; the marketing mode decides the marketing management mode.

Enterprise is the economic cell of society. A new concept of enterprise management is proposed in this book. Enterprise management should be people-centered and adopt technical instruments, working methods, enterprise culture and management mode to serve enterprise scientific research, production and sale, make a systematic integration with a combined management of hard and soft management and relative low consumption cost to produce high-quality consumption commodity so as to achieve a good dual-beneficial goal.

Enterprise leadership management philosophy and ever-developing enterprise culture are the soul of an enterprise. Enterprise leadership management requires the clear understanding of the relations between enterprise management benefit and development benefit, macro benefit and micro benefit, and the strategy, tactic, and plan of the development of the enterprise. Suitable thoughts and ideological methods, leadership measures, and art should be adopted to employ the organic management of hard and soft management, to minimize consumption in the production and commodity exchange process, to increase production efficiency, and finally to achieve the best production and management goals.

The aims of household living consumption management are to increase consumption fund (income) and to improve consumption level.

Management of exchange and consumption of commodity

Management clarifies two problems: the concept and nature of commodity exchange marketing process, and the marketing factors in the commodity exchange process. There are similarities and differences between marketers and manufacturers. Commodity exchange marketing is a very important factor of the productivity of a consumption society, and the bridge between consuming the product of a manufacturer and the direct consumer, the bridge to the realization of production aim. Without it, the consumption of a direct consumer and the productivity of the consumption society will not be realized. So, merchants are also great laborers (labor combining intellectual labor and physical labor).

To put forward a new concept and mode of marketing

Consumption and Management puts forward the new concept of marketing in a revolutionary way. It points out that consumption and marketing management are the management of the process from commodity exchange to its consumption by consumers. The long history of human beings is a scientific research and production consumption process led by living consumption and social consumption. New needs of consumption are created during this process and the needs act on consumption. People’s increasing needs of consumption for material and mental wealth lead to the cyclic development of economy. Therefore, marketing for target demands is called ‘large systematic service marketing based on target needs of consumers’, and to satisfy this means everything for an enterprise.

The new concept of ‘large systematic service marketing based on target needs of consumers’ is a continuous and evolving social marketing process and also a process of pursuing consumption satisfaction of target consumers. Systematic service marketing influences the organization of various aspects in society, participation of the people, the great market service structure and the increase of the marketing cost. The purpose of management is to control and direct the consumption during the social marketing process, carry out comprehensive budget-control management, achieve good enterprise marketing benefits – enterprise profit benefit and social benefit by relatively low consumption cost.

The author proposes six models on the marketing operation pattern and points out that the marketing mode and management mode will develop along with the development of time and consuming needs of consumers.

To demonstrate the general rules of ‘consumption creates wealth’ and surplus value

All social wealth is produced during the process of consumption. Consumption is the starting and end point of the motive and purpose of scientific research. Only by consumption of consumers, can value and surplus value of the products be realized.

Consumption and Management puts forward and demonstrates the wealth accumulation of surplus product value in socialistic society in consumption. During the market exchange, commodity has not only a common value exchange rule but also a specific rule. For example, a brand credit and realization rule of surplus product value, people’s customs and realization rule of surplus product value, a regional adaptation and realization rule of surplus product value, a purchasing level and realization rule of surplus product value, a service quality and realization rule of surplus product value, a convenient and timely supply of commodity and realization rule of surplus product value, a supermarket and realization rule of surplus product value, production in investing period and realization rule of surplus product value and so on.

Enterprises in a socialistic country must produce surplus value for the improvement of people’s living standards and the rapid development of the socialistic construction.

Academic and practical significance of this book

Consumption is the starting and end point of economic circulation. In the 30 years of research, the author aims to rebuild a systematic theory on consumption which suits the development of the time. The author understands that his theory may be a bold creation, a huge theoretical project, and a piece of tough work. But he believes that the promotion of this theory will reform the traditional economic structure and economic ecology. It will become a brand new strength for the development of China’s economy and society and further establish the academic position for consumption in all the disciplines.

Consumption and Management is a huge systematic theoretical project. With his own invention and the practice and thinking of his life, the author makes an overall systematic statement for the recognition of the social developing process in human history in the light of consumption with a great number of breakthroughs. This theory has important practical significance, as well as academic and historic significance.

Consumption and Management is the output of the author’s research for 30 years, and is a revolutionary theory. Consumption and Management opens a new age for the combination of scientific theory on consumption with practice, enlightens new thoughts in the academic field, has great practical significance for the integrated national operations and benefits for the national economy. The promotion of this book will definitely foster great people, push harmonious development of the theory on three important consumptions, satisfy the increasing consumption demands of people, benefit the development of human beings and the improvement of social civilization, and finally achieve the harmonious co-existence of people’s happiness and nature.