There’s a growing divide in this world. It’s not the wealth gap or the digital gap, or the education gap.

It's what I call the "stuff gap" and it's a divide between those that live to accumulate physical possessions and those that live to avoid them.

Growing up in the 80s and 90s, there was always a desire to buy new stuff: the latest toy advertised on Saturday morning cartoons It wasn't just the kids. My dad would tell my brother and I the specs and the latest woodworking tools or boat parts he wanted to buy.

Some time between college and my life today running a growing business out of Hong Kong I acquired a general dislike of "stuff." Why?

I always assumed that this realization was unique to my particular situation. When you periodically move from city to city often across international borders, all on your own dime without corporate or government expat relocation services, lots of "stuff" quickly becomes a liability. How is that that things you bought out of choice because you presumably liked them can become a royal pain in the rear end? It's all about utility.

Negative utility

Economists like to talk about how much utility an object or purchase gives a person. The more value it provides the holder or the buyer, the higher the utility. Utility is a measure of personal preferences. And different people have different measures utility for the same object. Imagine there's a young girl hoping that her boyfriend will give her a rose to show his love. If she actually receives such a flower, the girl will treasure that rose and post pictures on Facebook for all of her friends to see. Instead, imagine a boy who is trying to avoid the advances of a clingy girl he's not interested in...and he also happens to be allergic to flowers. If the boy in our story received the exact same rose, he would hate it. Not only does it a represent unwanted advances but the rose also will probably make him sick. He experiences negative utility from the rose...he'd would rather not have it.

How we define the utility we get out of any given object isn't as simple as liking it or disliking it. We can both like certain characteristics of an object but dislike other things about it.

Let's look at a trusty book you really like, the hardcopy version of Harry Potter and the Deathly Hallows, for example. This book makes you really happy. That's why you forked over $30 or more to buy it. You read it straight through in one sitting and then put it on your shelf and promptly forgot about it. The book sits well-behaved on your bookshelf and only bothers you when you occasionally have to move it to dust.

All is well and good until you decide you want to move from Ohio to Hong Kong. In Ohio, space is so abundant that you had a room bigger than the size of the average luxury Hong Kong flat that you called a library and was used just to store books. In Hong Kong, a 400 square foot apartment for single occupant is a luxury.

You want to make this move quickly and without spending lots of time and money. Suddenly, your hardcopy version of Harry Potter anymore isn't so attractive. Not only did it cost you $30 but even though you've long since finished enjoying it, it's still costing you money because you have to either carry it around the world, pay someone to move it, or figure out how give it away or sell it. It's as if the book is sitting on its shelf screaming out "Pay attention to me! Deal with me!" An object which you loved so much suddenly is quite a burden.

If you run into this problem frequently enough, like I do, you start to become adverse to buying physical items. My line of thinking when I consider buying a non-consumable physical object is something like this. "You want me to pay $xxxx for your widget, which is going to take up Y square feet of my apartment which costs me US$Z a month? And then I have to either pay to move it, carry it around for the rest of my life or figure out how to get rid of it?" I better REALLY like your widget if you expect me to not only pay the price you're asking but bear all of the after sales costs that come with dealing with your widget.

I thought it was just me...the result of a unique lifestyle that values mobility and the ability to work with a team spread across different countries versus accumulating large amounts of stuff that make it so much harder to achieve that goal.

But it turns out it's not just me and my lifestyle. I and others with similar lifestyles are just extreme examples on the leading edge of a demographic trend away from accumulating physical possessions. The cause is the Internet and computers which allow us to buy digital versions of products, photos, book, movies, etc, that have none of the downsides of a physical product. You didn't buy DVDs because you liked the shape of the product or the beautiful design of the plastic case. You bought them because you like watching movies. If you buy an eBook, you never have to pay to move it, dust around it to keep it clean, or grow through that agonizing decision making process of "do I keep it or do I give it away?"

Tyler Cowen said it best on Econtalk:

{% blockquote %}
"there will be a big generational shift away from the physical product. There will be a general decline of stuff, including the desire to own a home of your own. And we see this in the data--lower rates of household formation, lower rates of owning stuff."
{% endblockquote %}

Do you like to accumulate stuff or are you also trying to constantly minimize your physical possessions? Let me know in the comments!