--- John Foster <[log in to unmask]> wrote:
> Steve
> > > Consumers are in the market to maximize their welfare.
>
> Gus
> > This sentence is true by definition.
>
> It would be true if consumers had perfect knowledge....but they
> rarely ever
> do have perfect knowledge...especially when it comes to
> 'conspicuous forms
> of consumption' and 'new labour saving products.'
Fine, consumers maximize their expected welfare given their
information set.
> I learned that a baby will use 8000 diapers in her life. If these
> are
> disposable, that works out to several thousands of dollars. The
> price of
> infant formula is very high too, so the cost is about $4-8,000.00
> for
> formula.
>
> Interesting if the consumer choses not use diposable diapers, and
> simply
> washes the diapers with a 'no-name' brand of unscented soap. The
> value of
> using mother's own formula is even more cost saving than not using
> disposable diapers: less colic, less health problems, and fewer
> allergies..
I suppose. Of course you are not factoring in alot of stuff here.
Like the time spent washing those diapers is a cost.
[snip]
> The problem with classic laisez faire neo-liberal 'economics' is
> that it
> presupposes that a market exists, but the market is simply a
> concept. There
> is no 'market' since there are many forms of transactions and these
> transactions are between individuals for a wide range of goods and
> services,
> many of these do not involve any money....
>
> The 'Market' is simply a concept used for explanatory purposes;
> what is
> really occurring are many transactions of various forms. It is
> impossible to
> find a 'market' that is singular and has consumers with perfect
> knowledge....
*Yawn* No big surprise here. The research on consumer decision
making with imperfect information, incomplete information, asymetric
information is going quite nicely. In fact, the last three Nobel
Laureates in Economics for this are noted for their work on
information in economics. Micheal Spence, George Akerlof, and Joseph
Stiglitz.
Steve
=====
"In a nutshell, he [Steve] is 100% unadulterated evil. I do not believe in a 'Satan', but this man is as close to 'the real McCoy' as they come."
--Jamey Lee West
__________________________________________________
Do You Yahoo!?
Find a job, post your resume.
http://careers.yahoo.com
|