Hot Girl Summer Saves Economy

Did you don cowboy boots and glittery hats to attend one of the largest shows of the year? Or perhaps you dressed up entirely in pink and dragged your friends to the cinema to watch the biggest blockbuster movie of the summer? 

If so, you might have unknowingly been a “Mastermind” in saving the economy from falling into a recession last year. 

ECON101

Now, recession can be a big and scary word, but all that you need to understand is that the pandemic (not surprisingly) affected the economy. For this reason the government decided to step in, otherwise households and the financial state of the country were going to struggle. Thus, they spent a lot of money and manipulated taxes to make sure they could lessen the blow. This is called fiscal policy. 

Furthermore, monetary policy is involved when the central bank (which in the U.S. is the Federal Reserve) controls the overall supply of money to the nation with tools such as interest rates. This is an important way to control the increase of prices of goods and services. This is known as inflation.

Both fiscal and monetary policy were important factors that kept the economy afloat during the global pandemic.

So, when the government slowed their emergency spending and the Federal Reserve continued to influence interest rates, the economy risked dropping into a recession. The reason is that increased government spending (fiscal policy) can often lead to higher inflation. The central bank will then control the interest rates (monetary policy) to combat the inflation. 

Problems arise when interest rates need to rise, and there comes a tipping point where the economy buckles under the pressure of the interest rates being too high. 

This is why economists were worried about the state of the economy going into 2023. That was until Taylor Swift’s The Eras Tour, Beyoncé’s Renaissance World Tour and the Barbie movie came into play.

This trifecta of femininity essentially saved the economy. Because of these events, women increased their spending during the summer of 2023 and helped bolster the economy. 

Female Power and Pandemonium 

The spending didn’t stop at concert or movie tickets either; women were booking hotel rooms, buying new outfits and supporting a myriad of local businesses. 

For example, Swifties, the name given to fans of Swift, went fanatical for donuts decorated with her face on them. According to the Wall Street Journal, Glam Doll Donuts, a local donut shop in Minneapolis, had their most successful day since opening as they capitalized on the pandemonium Swift caused with her show, selling boxes of a dozen Taylor-themed donuts for $63 a box. 

The Wall Street Journal affectionately named the phenomenon of Swiftie’s boosting local economies as Taylornomics. 

“[Swift’s] fan base is just so loyal,” explained Selene Valadez, a partner at Chicago Twenty Something. “There are things that are trending, but this is more than a trend.” 

“It doesn’t matter your age range or if you’re male or female. Whether it’s in the movie or the music, it’s things that people could relate to,” Valdez said. “So, when you have that connection, it’s really big for marketing.”

Local businesses have been thriving in light of the mayhem that this trifecta has created. Chicago and Minneapolis both managed to break records for hotel occupancy while Swift was in their respective cities, while Cincinnati’s tourism office estimated spending of $48 million surrounding Swift’s visit. 

Furthermore, the Wall Street Journal found that these trends continued around the country with a shuttle service at Metlife Stadium in New Jersey selling upwards of 2,000 tickets at $15 a pop for each night of the tour—well over their usual numbers. Nashville’s Country Music Hall of Fame created a pop-up exhibit that showcased Swift. It became their first ever sold-out exhibition. 

“Since the end of the pandemic, there has been an overall improvement in the economy. Most indicators credit increased consumer spending from women and the highest rate of prime-age women participating in the labor force since 1948,” said Mia Killion, an economics student at DePaul University.

“The tours and movie demonstrated the power of pleasure spending,” further explains Killion. “These factor into the GDP, and because of COVID-19, this type of spending was not viable. People were able to save money during the pandemic, and now that they have the opportunity to spend this money, they are going to take it.”

Similarly, this trajectory has been seen in other countries as well. According to expert Michael Grahn, Danske Bank’s chief economist, Beyoncé’s Renaissance Tour caused the inflation bump in Sweden in May. Swift’s tour is anticipated to bring in well over $1 billion in revenue—the first in history to reach such a financial feat with Beyoncé’s not too far behind.

Meanwhile, Greta Gerwig’s Barbie reached a whopping $1.45 billion in box offices across the world, making it the highest-performing film directed by a woman of all time. People flocked to the movies in their Barbie-inspired outfits, reminiscing about their childhood while also walking out with an interesting take on the state of gender equality in the modern world. 

The Pink Tax

In light of a recession or economic hardships, it is natural for the population to cut back on their spending, only paying for things that they consider essential. Despite this, women have to spend a considerable amount of money for things that are deemed necessary compared to their male counterparts due to a “pink tax.”

Pink tax refers to when the products marketed specifically towards women are more expensive than those marketed towards men—things like women’s razors or body wash being priced higher than equivalent male products. This gender-based price discrimination causes women to spend on average $1,300 more per year than men. 

The pink tax also doesn’t take into consideration feminine hygiene products (sometimes referred to as the tampon tax) or common items bought mainly by women, such as lipstick.

Historically, despite women being forced to spend more on their daily necessities, they had less purchasing power. 

The Pew Research Center finds that while we haven’t seen any dramatic changes to the gender pay gap in the last few years, it is slowly decreasing among the younger generations. In 2022, women were making on average 82 cents per every dollar men were making within all age groups. However, women aged 25-34 were making 92 cents to the dollar. 

Women are becoming more educated and are starting to be paid accordingly, meaning that their power of spending is increasing. Forbes explains that there is $3.1 trillion at stake that could benefit the economy given that women were presented with more equality. 

Therefore, given that women are being given greater purchasing power, they are able to spend their money on what some may consider frivolous, such as concert tickets. It is these “frivolous” expenses, however, that managed to keep the economy afloat last year. 

Header by Sofi Martinez