Yes!! Completely agree, and was also thinking along similar lines.
It is clearly a bullshit job, in the sense of adding nothing to the quality or service being offered.
It distorts and destabilizes the market: advertizing means an increase in the supply curve, due to the greater costs of operation with dollars funneled to advertizing, corresponds to a simultaneous shift in the demand curve, throwing a wrench into the existence of possible equilibria
It encourages concentration, since the bigger firms can swallow the costs of advertizing departments easier.
In the US advertizing really accelerated with the deregulation of Telecoms after WW2 and again by Reagan.
The Econ 101 justification for advertizing is as information, i.e., if customers are not aware of a utility-maximizing product how can they buy it? That's, of course, nonsense, since most of advertizing is manipulation rather than information. Instead of allowing advertizing, one can introduce a market of product information curators, who simply hold databases of products and shoppers can purchase their services as middlemen for a product they are looking for, as far as specifications. Then by encouraging payment upon customer satisfaction, incentives for correct information will be created.
This was also recently published: https://simone.org/advertising/
Great to see more people reach the same conclusions, hope the debate kicks off soon.
Yes!! Completely agree, and was also thinking along similar lines.
It is clearly a bullshit job, in the sense of adding nothing to the quality or service being offered.
It distorts and destabilizes the market: advertizing means an increase in the supply curve, due to the greater costs of operation with dollars funneled to advertizing, corresponds to a simultaneous shift in the demand curve, throwing a wrench into the existence of possible equilibria
It encourages concentration, since the bigger firms can swallow the costs of advertizing departments easier.
In the US advertizing really accelerated with the deregulation of Telecoms after WW2 and again by Reagan.
The Econ 101 justification for advertizing is as information, i.e., if customers are not aware of a utility-maximizing product how can they buy it? That's, of course, nonsense, since most of advertizing is manipulation rather than information. Instead of allowing advertizing, one can introduce a market of product information curators, who simply hold databases of products and shoppers can purchase their services as middlemen for a product they are looking for, as far as specifications. Then by encouraging payment upon customer satisfaction, incentives for correct information will be created.
Social media and other online services already function as "product inormation curators" and "databases of products".