How do we do the same with gasoline? ie how to we increase taxes on fuel and make it a lifestyle choice rather than evil socialist interventionism? In the long run, we're all dead. John Maynard Keynes
But when the quality is the same or even inferior, why do people pay so bloody much for brands? Shouldn't the companies pay us for wearing their logos, just like they pay to have them shown on TV or billboards? I can't understand it for the life of me! J and Migeru, o oracles of economics, have you got any ideas? Peak oil is not an energy crisis. It is a liquid fuel crisis.
Although personally I also like the Pavlovian rats and levers analogy - not that it's necessarily incompatible.
oracles of economics, have you got any ideas?
This view of advertising is demolished by JK Galbraith in The New Industrial State, which I thought you were reading?
Basically Galbraith claims (if I am not mistaken this is a key part of what he calls the "revised sequence") that firms manage consumer demand through a variety of means and that advertising is a key way to both create needs and maintain a level of demand for them.
Obviousle since standard microeconomics takes consumer sovereignty as axiomatic, an analysis of how firms control consumer demand is anywhere between nonsense or anathema, depending on how well a neoclassical economist understands the extent to which Galbraith's view of advertising threatens the foundations of standard microeconomics. The peak-to-trough part of the business cycle is an outlier. Carnot would have died laughing.
Oliver Stutchbury, who built Save & Prosper in the Sixties and Seventies (and also wrote tomes on the use of principle, unit trust management and capital taxes) kept the entire UK Tax code in his little room. He told me it was quite a strain to read them. You can't be me, I'm taken
the 24/7 propaganda machine to go out and buy stuff and feel happy, strong, sexy and free that is the advertising industry
Important addendum.
So by all means let's argue for higher petrol taxes. But also that a percentage of the tax be ring-fenced for communications purposes.
