History

“Shrinkflation” Is as Old as the Hills

And people used to think it was the right thing to do.

A medieval image of five peasants eating bread.
Livre du roi Modus et de la reine Ratio, 14th century. Paris, Bibliothèque nationale, Département des manuscrits, Français 22545 fol. 72. Wikimedia Commons.

Skinny Gatorade bottles. Puffed-up bags of chips. Tiny Filets-O-Fish. This has been the summer of “shrinkflation,” with the media full of stories of consumers who are pissed off about companies selling smaller portions, while keeping prices the same. The practice just seems downright sneaky, and the complaints have gotten so loud that both Trevor Noah and John Oliver have devoted time to riffing on the resulting media coverage.

Many of these stories frame shrinkflation as a recent phenomenon, a novel form of trickery that helps corporations keep profits high without consumers catching on, despite rising inflation and lingering supply-chain issues. But anyone who buys processed snacks knows packages have been full of air for years, and the practice of shrinking sizes instead of raising prices goes back centuries. Shrinkflation is not new, and for a long while it was actually considered the more ethical way of doing business.

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Consider a loaf of bread, a very basic unit when it comes to prepared food. Whenever grain was in short supply in feudal Europe, bakers had two choices: They could either raise prices or sell smaller loaves. They chose the latter. To do otherwise would violate the widely-held principle of a “just price”—formulated by Thomas Aquinas in the 13th century—and invite a bread riot.

Bakers who raised prices risked a breakdown in the social order, especially in the rowdy cities of the late 18th century. “The peasant threatened with a lack of bread sought to assuage the Almighty, but urban plebes faced with excessive prices for bread would riot against the magistrates or their overlord, loot the grain stories, and kill bakers,” wrote historian Witold Kula in Measures and Men.

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First published in 1970, Kula’s book has become a classic for historians of measurement. (Yes, there are historians of measurement. Who else is going to teach us about the irregular rollout of metersticks, or how an 18th-century cartographer was hacked almost to death by a crowd that mistook him for a sorcerer?)

Standardized measurements are a relatively new phenomenon. The metric system came out of the Age of Enlightenment, and before that, builders who moved from town to town often had to figure out just how long a foot or an ell (short for elbow) was in each place they visited. This might seem highly inefficient to us, but it didn’t hinder the construction of Gothic cathedrals that still stand (quite majestically) today.

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When it came to grain, different measures were often used by the same people depending on whether they were buying or selling, with the price remaining constant. This system helped facilitate trade, and many merchants, especially those involved in transport, made their living from this discrepancy.

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Why couldn’t feudal merchants just buy low and sell high, raising prices for consumers as much as the market would bear? Because that would be considered unethical.

As historian Ken Alder wrote in The Measure of All Things, when discussing the logic of commerce in France before the Revolution: “The Ancien Régime was governed by a ‘just price’ economy, in which basic foodstuffs were sold at a customary price set by the local community at a level which most of the people in that community could afford. The just price was enforced by moral sanction and ultimately the threat of violence.”

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Sanctions often came from authorities on high, while violence happened at the street level. Bakers who dared to charge more than the just price for a loaf of bread took the risk of being run out of town—or worse. This danger didn’t stop the price of flour from fluctuating, though, so the bakers just sold smaller loaves when flour was high and went about their business. Shrinkflation was a matter of survival. On top of that, there usually wasn’t enough small coinage to make change with every transaction, so it was just easier to keep prices the same.

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Could the loaves keep shrinking forever? No, even in an era of irregular measurement, consumers demanded a certain amount of bread for their coin. Bakers sometimes had to resort to additives, such as alum, cobwebs and bone-earth (the ash from animal remains blasted with heat), to keep their loaves plump. But that’s something different (and more disgusting) than shrinkflation, so we’ll put that aside for now.

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Consumers expected a loaf of bread to cost a certain amount, and they felt cheated when that changed. The price, tied up in notions of justice, was the most important part of the transaction. This mindset is at odds with our contemporary ideas of commerce, as is evident by the tone of this summer’s news stories about shrinkflation.

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Based on the coverage, which seems to tap into a populist vein of discontent, people in the US in 2022 are most pissed off when shrinkflation happens to food and other household necessities like toilet paper. They have to buy this stuff, and they don’t want the prices to go up, but they also don’t want the prices to stay the same because of some kind of “trick.”

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When the trick is successful, however, it might even be celebrated on Wall Street. A common canard in marketing is the story of how American Airlines saved beaucoup bucks in the 1980s by removing one olive from the salads served on flights. For writers of business books, that olive has become a symbol of cost-saving simplicity. It was also shrinkflation.

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Kula died in 1988, so we can’t ask him what he thinks about skimpy in-flight salads or skinny Gatorade bottles, but he did write about the political effect of maintaining a just price for goods. That system made it easier to alter the price of food in such a way “that was less obvious, and therefore less offensive, to the urban populace, whose reaction is often feared by the bakers’ guilds and the municipal authorities, as well as by the feudal overlords.” In other words, shrinkflation was less conspicuous, less likely to get people asking questions, less likely to make them angry, than raising prices.

Just give people a smaller loaf of bread, the logic went, and maybe they won’t throw a brick.

Companies have been making that same bet for years. Shrinkflation is not new, and it’s probably not going away.

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